The IPL newsletter: Volume 6, Issue 111

Incentives for ICT Adoption: Canada and its Major Competitors

Jacek Warda, ITAC

This paper illustrates how countries that are serious about promoting the use of information and communications technology to improve productivity and overall economic performance have used a broad array of incentives to spur the use of technology. The paper notes that while a number of OECD countries have incentives for ICT adoption, Canada lags its competitors in the provision of incentives for activities that facilitate technology adoption. Even more alarming is the rapid rate at which emerging economies, such as Korea, India and China, have instituted measures to spur adoption. China, for example, deploys a range of measures including depreciation schemes, investment allowances and allowances for technological innovation. Korea offers a tax credit for acquisition of machinery and equipment by small companies. It also offers a tax credit specifically for productivity enhancing facilities of 7 per cent. Korea is also one of a number of jurisdictions that offers tax credits for training in ICT use. Others that offer incentives for ICT training include France, Austria and the Netherlands. This paper advocates that Canada should actively provide incentives for the adoption of technology.

Intellectual Property and Competition Policy in the Biotechnology Industry

OECD Policy Brief

The science of biotechnology has been pushing the frontiers of human knowledge and intellectual property (“IP”) for three decades. As scientists developed techniques for isolating and creating genetic material and began to apply them commercially, a new industry grew and so did its appetite for patent protection. The number of patent applications from the biotechnology industry has grown faster than the number of patent applications from other industries over the past several years. The thousands of biotechnology patents issued annually contribute to new products, services, and tools in agriculture, pharmaceuticals, and industrial products. Inventors who develop biotechnological innovations rely on IP rights to protect and validate their work. They also rely on IP licenses to gain access to needed tools and technologies. In addition to spurring important inventions, however, the rising tide of biotechnology patents has brought concerns that they are being granted too freely and too broadly. Too many patents that cover too much ground will not only harm competition, but will also stifle innovation by making further research riskier, more difficult or more expensive. At the same time,
certain licensing techniques that are used in the biotechnology industry can aggravate those problems. This Policy Brief addresses how government officials can cooperate to foster innovation without stifling competition, as well as some ways in which licensing behaviour that can fall foul of the competition laws

National Innovation Systems – Analytical Concept and Development Tool

Bengt-Åke Lundvall, DRUID

This paper reflects on the origin and use of the national innovation system concept in terms of theory and practice. It argues that the concept has some characteristics in common with an engineering approach but also with critical theory and grounded theory. It criticizes attempts to make the concept ‘more rigorous’ through organizing the definition and analysis around a list of ‘functions’, ‘factors’ and ‘activities’ and presents the principles used to organize the Danish DISKO-project as an alternative and less agnostic approach. Here a core of the system is defined and it is illustrated that it is necessary to both to understand micro-behavior in the core and understand ‘the wider setting’ within which the core operates. The final section of the paper discusses what further developments are needed to make the concept relevant and applicable to developing countries. Here special attention is given to institutions and capabilities supporting learning. Here there is a need to give more emphasis to the distribution of power, to institution building and to the openness of innovation systems.

Fishing Upstream: Firm Innovation Strategy and University Research Alliances

Maryann Feldman, Rotman School of Management

This paper examines how innovation strategy influences firms’ level of involvement with university-based research. Our results suggest that firms with internal R&D strategies more heavily weighted towards exploratory activities allocate a greater share of their R&D resources to exploratory university research and develop deeper multi-faceted relationships with their university research partners. In addition, firms with more centralized internal R&D organizations spend a greater share of their R&D dollars on exploratory research conducted at universities. In contrast to other external partners, we find evidence suggesting that universities are preferred when the firm perceives potential conflicts over intellectual property.

Wireless in British Columbia: 2005 BC Wireless Industry Survey Results

PriceWaterhouseCoopers and the Wireless Innovation Network BC (WINBC)

This report summarizes the results of a survey of wireless companies in British Columbia, Canada, conducted between April and May 2005. A list of companies was compiled from the WINBC directory and from publicly available sources. The list included BC-based organizations developing and deploying wireless technologies and services as a significant portion of their business, and organizations from other jurisdictions with significant wireless-related operations in the Province. Participants were asked to comment specifically on the wireless portion of their business.

Economic Performance: Highlights of a Workshop on Economic Performance Measures

US Government Accountability Office (GOA)

The quality of the economic performance assessment of federal programs has improved, but gaps still remain in the application of the measures used. This report highlights the findings and recommendations of a panel convened in December 2004 to discuss economic performance measures. The panel of government and academic participants sought to discuss the use of economic analysis, such as benefit cost or cost effectiveness, for helping to assess federal programs’ performance. Participants were selected based on various qualifications related to the subject matter. It finds that the quality of the economic performance assessment of federal programs has improved but is still highly variable and not sufficient to adequately inform decision-makers. The gaps in applying economic performance measures are that they are not widely used, mechanisms for revisiting a regulation or program are lacking, retrospective analyses are often not done, and homeland security regulations present additional challenges and typically do not include economic analysis. To expand the use of measures, panelists suggested evaluating existing programs retrospectively and applying the measures to homeland security issues. Panelists also outlined a number of recommendations toward improving the general economic principles and guidance that economic performance analysis is based upon: developing a minimum set of principles and abbreviated guidelines for economic performance analysis; developing one-page summaries and scorecards of analysis results; standardizing some key values for assumptions; and, creating an independent and flexible organization to provide guidance and develop standards.