MEDIA
To fix Canada’s economic problems we need real strategy
We don’t need no education: How Canada’s broken university system holds us back
How not to run a country: Government ineptitude and Canada’s economic malaise
How Canada’s middle class got shafted
Dan Breznitz
These four essays by IPL Co-Director Dan Breznitz are part of The Globe And Mail's new series, Prosperity’s Path. Successive governments have been warning about Canada’s slowing productivity for more than three decades. Now as the cost of living rises and per-capita economic output shrinks, this problem has reached an inflexion point. Dan Breznitz lays out how we got into this productivity crisis, and how we can get out.
RESEARCH
Success Story or Tall Tale: Discursive Cooperation and Economic Restructuring in Iceland
Darius Ornston, Review of International Political Economy
Political economists have long recognized the power of ideas to influence economic adjustment by shaping public policy and fostering inter-firm coordination. This article extends this argument, demonstrating how ideas can have a direct and unmediated impact on economic restructuring. More specifically, it identifies discursive cooperation, or collective storytelling, as a distinct logic of collective action, separate from policy concertation and inter-firm coordination. Examining twenty first century Iceland, this article illustrates how shared narratives accelerated the country’s movement into financial services and tourism by facilitating the diffusion of new business models and attracting external resources. Absent inter-firm coordination, policy concertation, or supportive public policies, however, stakeholders struggled to invest in public goods. Instead of incremental upmarket movement, Iceland was characterized by volatile boom-bust dynamics. In illustrating the transformative power of storytelling in small open economies, this article simultaneously highlights the perils of relying on discursive cooperation alone.
Restoring Freedom in Freedom of Thought
Daniel Munro
This article is authored by IPL Senior Fellow and IPL Associate Daniel Munro. The article discusses the issue of whether freedom of thought at risk in the digital age. Social media, evolving neuro-technologies and the algorithmic environment increasingly complicate how we form thoughts and interfere with our ability to make decisions in autonomous, self-directed ways. The piece is a response to the report Freedom of Thought: Reviving and Protecting a Forgotten Human Right, from CIGI’s project on freedom of thought, led by Susie Alegre and Aaron Shull.
Should Governments Steer Private Investment Decisions? Framing Canada’s Industrial Policy Choices
Steve Lafleur, Institute for Research on Public Policy
This report is the first in IRPP's multi-year project, “Canada’s Next Economic Transformation: What Role Should Industrial Policy Play?” IRPP has assembled an expert steering group to understand the challenges and opportunities that motivate industrial policy, to evaluate past successes and failures, and to assess various industrial policy tools. The group is informed through consultations we are holding across the country with academic experts, governments, Indigenous leaders, industry leaders and other stakeholders. The report outlines Canada’s economic challenges with the aim of defining an industrial policy and laying out some potential guidelines for it. Future publications will explore issues such as program performance metrics and evaluation, and mandates and governance. The final report will offer a proposed strategy for Canada and recommendations for governments.
University of Toronto Entrepreneurship 2023-24 Annual Report
University of Toronto
This report summarizes how services from U of T accelerator hubs support entrepreneurs at any stage and across all industries. The report includes sections on equioty, diversity and inclusion in entrepreneurship; events, competitions, and showcases; high-impact startups; UTE programs and initiatives; and international entrepreneurship. The report summarizes that "from wet lab space for biotech startups to pitch prep and funding opportunities – the UTE community has a wealth of resources, knowledge, and opportunities to help entrepreneurs get their ideas off the ground."
Assessing the Impact of Propulsion Quebec
Bruno Arcand, Bentley Allan, Derek Eaton, The Transition Accelerator
Building the clean, competitive economy Canada needs in a net-zero world will require close collaboration between the public and private sectors. One way to streamline that process is by creating independent intermediaries—trusted third parties that understand the needs of both sectors and can help coordinate their actions. Propulsion Québec provides a helpful example of an independent intermediary in Canada, with the goal of establishing Quebec as a global leader in the electric and smart transportation sector. This report looks at the impact of Propulsion Québec on electric transportation. What are their successes to date, and what can the rest of Canada learn from them about the role of independent intermediaries? Also see the related webinar The Case for Independent Intermediaries in Building a Competitive, Clean Economy: Lessons from Propulsion Québec.
Survey of Innovation and Business Strategy: Data tables, 2022
Statistics Canada
This release includes data on sales, expenditures and personnel of Canadian enterprises in 2022 are now available from the Survey of Innovation and Business Strategy. Results are available by industry and broken down by enterprise size and region. The Survey of Innovation and Business Strategy (SIBS) is a cross-economy survey of business enterprises and industrial non-profit organizations in Canada. The concepts and definitions employed in the collection and dissemination of innovation data are provided in the Oslo Manual: Guidelines for Collecting and Interpreting Innovation Data, 4th Edition (Organisation for Economic Co-operation and Development, [OECD and Eurostat, 2018]). According to the manual: "An innovation is a new or improved product or process (or combination thereof) that differs significantly from the unit's previous products or processes and that has been made available to potential users (product) or brought into use by the unit (process)." The SIBS collects complementary qualitative business information, including market characteristics, use of advanced technologies, business strategy, business practices and participation in global value chains. The survey also collects quantitative information on total sales, innovation expenditures, purchase of goods and services and personnel, supplemented by percentage distributions by specified subgroups.
World Intellectual Property Organization
The Global Innovation Index 2024 (GII) takes the pulse of innovation against a background of steady but slow global economic growth, shrinking innovation finance and sluggish productivity. Tracking the most recent global innovation trends, the GII finds that innovation investment slowed in 2023, in marked contrast to previous years, making the prospect for 2024/2025 remarkably uncertain. But the outlook is not entirely cloudy. Technological progress and adoption in fields as diverse as supercomputing, connectivity, health, sanitation and green technologies continues unabated.
Selling less of the family silver: boosting UK growth
David Connell & Bobby Reddy, Cambridge University
This report analyzes how changes to UK innovation and industrial policy could reduce the early sale of promising companies to overseas firms and increase economic growth. The researchers from Cambridge University note that sale of venture capital-backed science and technology-based start-ups is the most important problem facing UK innovation and industrial policy. Although the sale of large, mature firms such as ARM and Micro Focus often create headlines, acquisitions of earlier-stage innovative British companies – such as Deepmind, Solexa, Skyscanner, Shazam and Neptune Energy – by overseas buyers are arguably more damaging to the British economy. Such early acquisitions result in a "truncation of subsequent firm growth in the UK", says the report, which calls for a shift in government funding away from blanket subsidies and towards focused funding through contracts, grants and equity investments. The authors emphasize that "it is essential that ambitious entrepreneurs with the desire and ability to grow a major UK corporation are given as much help as possible to do so, whether this be as a public or private company."
Conseil de l’Innovation du Québec
The Conseil de l’Innovation du Québec has submitted its report Towards an innovative Quebec: rethinking the Quebec model of support for business research and development (R-D). Under the leadership of Sophie D’Amours, rector of Université Laval and president of the Quebec Innovation Council, and the Chief Innovator of Quebec, Luc Sirois, supported by the work of a committee of experts, the report proposes 13 concrete recommendations to optimize the model of financial support for business research and development in Quebec and respond to related challenges. The report is part of the mandate given to the Quebec Innovation Council of Quebec as part of the Strategy for Quebec Research and Investment in Innovation 2022-2027 (SQRI2) to examine incentives for research and development and to submit recommendations to optimize them.
UK Department for Business and Trade
The UK Government launches a modern Industrial Strategy and new Advisory Council ahead of International Investment Summit. Business and Trade Secretary Jonathan Reynolds and the Chancellor of the Exchequer Rachel Reeves have published a green paper consultation call to inform delivery of the Government’s modern Industrial Strategy. The strategy will drive long-term growth in key sectors that is sustainable, resilient and distributed across the country. Announcing the eight growth sectors will be the focus of the Strategy, alongside naming the new Industrial Strategy Advisory Council’s chair, the Business Secretary has promised to ‘give investors a ten year plan to choose Britain’. The key sectors the government will focus its modern Industrial Strategy are on advanced manufacturing; clean energy industries, creative industries; defence; digital and technologies; financial services; life sciences; and professional and business services.
Discussion Paper: Federal Programs for Business Innovation
Senator Colin Deacon
This discussion paper aims to map out the range of innovation-funding programs offered by the Canadian federal government and identify key questions and observations to guide discussion on improving Canada's innovation programs. The initial purpose of this study is to identify the federal programs that are intended to support innovation in the Canadian economy and any available program-specific effectiveness data. The first step of the research identified the universe of federal programs intended to foster innovation, regardless of criteria such as industry, company size, region, etc. The federal innovation universe totals over 140 programs reporting to 28 departments or crown corporations. In each case, the stated name, size and scope of the program, target applicant, purpose, and goals were identified. The team then conducted interviews with stakeholders in the innovation ecosystem to benefit from their perspectives on both their needs and the effectiveness of existing programs in meeting those needs.
The paper explores seven questions to help determine what Canada is getting right and wrong in its policies to support to innovators. The report notes that "these questions are intended to provide a starting point to uncover actionable insights that might eventually help to improve the effectiveness of Canada’s innovation programs, ensuring they catalyze private sector investment and yield measurable results that reinforce and accelerate Canadian business success, globally."
1) Globally, what best practices do the most successful government-funded innovation programs use to effectively catalyze business investment in innovation?
2) How do the most successful Government innovation programs ensure that program delivery aligns with the pace and realities of business?
3) Have application criteria been simplified to be clear, justifiable, and accessible, while also leveraging arm’s length private sector due diligence?
4) Are the most innovative companies being supported, regardless of their technology, industry or location?
5) What Key Performance Indicators (KPIs) are used to measure the achieved outcomes of these programs, and do these KPIs influence government decision-making?
6) Is federal procurement effectively supporting innovative companies, helping to verify product viability and providing early revenue?
7) Are there successful programs that unlock the commercial value of government-funded R&D (e.g., intellectual property, data, etc.) for the benefit of the Canadian economy?
EVENTS
SSTI's Annual Conference: Focusing on the Future
December 10-12, Metro Phoenix, Arizona, USA
Yearly gathering of leaders across all aspects of regional innovation advancement through public-private partnerships, policies and government-funded programs in the practice of technology-based economic development across the U.S.
WICK#12 PhD Workshop in Economics of Innovation, Complexity and Knowledge
December 12-13 2024, Turin
Annual meeting for doctoral students and young researchers in Economics of Innovation, Complexity and Knowledge. The Workshop is organized by the students of the Vilfredo Pareto Doctoral Program in Economics, in collaboration with the University of Turin, BRICK, Collegio Carlo Alberto and Young Scholar Initiative
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This newsletter is prepared by Travis Southin.
Project manager is David A. Wolfe
