Canada excels in science, but not so much in innovation

When it comes to generating reports on science and innovation policy, Canada is undoubtedly a powerhouse. Earlier this month, the Council of Canadian Academies released Competing in a Global Innovation Economy: The Current State of R&D in Canada, the latest installment in this tradition. The report was competently written, although predictable in its main conclusions.

That is because over the past half a century, we have perfected the art of telling ourselves basically the same story, albeit drawing on different assortments of evidence overtime as international datasets on things like R&D, publications, citations, and patents have become more readily available. Simply put, the story is: Canada excels in science, but not so much in innovation. The self-congratulatory part of the argument quickly turns into self-immolation, as we fail to capitalize on research that is well-regarded internationally by growing technology behemoths that create wealth in this country.

The story is popular as it usually prefaces advocacy for a variety of solutions, be it direct investments in industry R&D, greater focus on STEM in academia, an emphasis on funding R&D in enabling technologies, a revamping of the intellectual property regime, or even public subsidies of one kind or another for technology entrepreneurs. And no, advocates of those solutions are not simpletons who believe they have found a silver bullet that will solve our national embarrassment over innovation. However, they forcefully argue that their favoured recommendation is critical to addressing the problem, and so the story then gets re-told time and again.

Still, there is surely value in monitoring the situation and learning about where we have improved or have fallen behind in research and technology development, and the CCA report delivers those messages persuasively. They were well summarized here. However, this policy debate in Canada remains awfully unimaginative and incapable of generating original ideas or solutions.

That is because as much as reports on innovation take an apparently cosmopolitan outlook by invariably drawing on data from the OECD and comparing Canada to a number of “peer” countries, this decades-long conversation is really about the long shadow cast by the U.S. largesse.

This is fairly evident in how the innovation problem has been framed in Canada over the past few decades: whether it is the old concern over the large American multinationals that have long established branch plants in Canada but choose to carry out its innovative activities down south; the impact of innovation on the labour productivity gap between the two countries; recurring discussions over our lack of a unified approach to handle university intellectual property (with the U.S. Bayh-Dole act being the frequent starting point of the conversation); or the current concern with our inability to “scale” technology start-ups (like, you know, those companies in Silicon Valley).

If problems are framed from this perspective, solutions are no different. Granted, most of the academic thinking on innovation originates in the U.S., and Canada is not alone in the world in trying to emulate American successes in science and technology. In terms of policy alternatives, there have been recurring proposals to borrow from the Bayh-Dole Act and to create a Canadian version of the Small Business Research and Innovation (SBIR) program, for example. And the recently announced federal supersclusters, as Minister Navdeep Bains flippantly announced to much derision, is about creating “made in Canada Sillicon Valleys.”

However, there is an obvious limitation to this approach when you are 10 times smaller and economically interdependent with the 800-pound gorilla. As the CCA report points out, we are currently worried about Canada’s inability to scale technology firms, which is attributed to the lack of talent with the skills and experience to grow start-ups into global companies and to foreign acquisitions. In other words, we don’t have as long a roster of experienced tech CEO types and the deep pockets of investors that one finds in Silicon Valley or the Boston area. We are trying to play the U.S. game of creating and dominating tech industries globally out of R&D activities – a game they play with much larger and richer teams.

Of course there is no point in going into a state of denialism about this and rejecting the importance of technology sectors or innovation for the economy. And obviously, there are lessons to be learned from the U.S. leadership in these areas. However, the way we think about and frame policy issues constrains our imagination, as well as what we can conceive of as alternatives. After five decades of telling ourselves the same story, can we start asking different questions about innovation?