Pondering Canadian competitive advantage

By Adam Holbrook

Summer has come, Parliament has recessed, and those who can afford it have retreated to some form of seasonal respite, whether it is a pup tent in the backyard or a second home in cottage country. The federal government has, for many years, agonized over its science, technology and innovation (STI) policy. There have been numerous efforts in the past two decades to establish agreement among stakeholders as to what this policy should be. Yet, in the absence of a formal consensus, an unwritten STI policy has come into being, and it has been remarkably consistent over this period.

This policy has the following elements:

* direct support of basic and early stage applied research in the university sector;

* creation of specialized, decentralized, stakeholder-operated granting agencies for university-based research (e.g. Networks of Centres of Excellence and Genome Canada);

* shift from direct support for industrial S&T and innovation to indirect methods (the NRC Industrial Research Assistance Program is a notable exception);

* shifting from direct R&D spending to mission-oriented S&T by government labs;

* active recruitment of S&T human capital through repatriation of Canadian emigrants and encouragement of highly-skilled immigrants;

* participation in international consortia for large science projects such as space programs; and,

* federal support for major technology-based projects (e.g. the Information Highway).

For the most part, these policies have been successful and have served Canada well. What they have not been able to do is provide a framework for innovation (as opposed to research and invention) in Canada. Nor have they been directed to complement Canada's economic and social competitive advantages. We do not recognize or celebrate the fact that we have world-leading programs in R&D and innovation. For example, other countries look at programs such as the Networks of Centres of Excellence as world leaders in the field of R&D management.

Canada has global expertise and a competitive advantage in a number of technology-based industries and social programs. We are a major exporter of energy, and other resources. The Windsor-Quebec corridor enjoys a geographic and social competitive advantage in the North American manufacturing system, particularly in the automotive industry.

Our geography and climate give Canadian developers of information and communications technologies, and transportation technologies (ICTs), a demanding domestic market. We have, in a number of locations, an enviable quality of life that attracts knowledge workers from around the world. Yet we do not tailor our STI policies to build upon these competitive advantages.

Yet equally, there are a number of areas where we are not competitive. Other parts of the world have better competencies in some technologies — so why do we try to compete with them? An argument can be made that we should maintain a "watching brief" in those areas where we have no competitive advantage. But should we create centres of expertise in research (and thus innovation) areas where we have no clear advantage? A classical view would be that Canadian STI policy should focus on our economic competitive advantages such our advantages in climate and environment, energy production, ICTs, and transportation.

social competitive advantages

But we also enjoy social competitive advantages of lifestyle and relatively high levels of social justice. Any list based solely on economic factors excludes a number of highly important areas, most notably health and biotechnology. This should not imply that we need not carry out work on health technologies. On the contrary we need to support this work in order to maintain our competency in health care, and maintain one of our social competitive advantages — our much maligned health care system.

The federal government recently brought out a major strategy "Mobilizing Science and Technology to Canada's Advantage". For the first time in recent years, it identifies specific priorities for federal S&T investments. One may take issue with those selected (environmental S&T, natural resources and energy, health and related life sciences, and ICTs) on the grounds that they are too general, but at least it is a good start.

All parts of Canada are not equal in terms of economic or social competitive advantage. Our STI policies should not be based on a "one size fits all". This is why we need to understand better the role of place and quality of life in the development of STI.

Vancouver, for example, has global expertise in fuel cells and biotech research, yet does not have any over-riding economic reasons for this advantage. Yet investments have been made in these two areas, taking advantage of the presence of pools of highly skilled researchers, many of whom have been attracted to the region by lifestyle considerations.

innovation is a human activity

R&D may be an input to the innovation process, but it is people who actually innovate. R&D generates the ideas from which innovation flows. Innovation is a human activity; it cannot happen without human capital. We need to stimulate our innovative human capital and R&D provides that stimulant. STI programs, whether undertaken to maintain our global position, or those undertaken to exploit a specific competitive advantage, should include consideration of the factors that might (or might not) attract the human capital from around the world required to make these programs competitive on a global scale.

So the question for you, as you sit in a deck chair sipping your beer, what are our competitive STI advantages? In what economic areas do we clearly have a research, and by extension, an innovative advantage? Are we investing in programs where we have no natural (read economic) advantages and where we must compete against the rest of the world on the basis of our social competitive advantages? Do we really understand the role of human capital in our STI programs? Have a good summer!

J.A.D. (Adam) Holbrook is an adjunct professor and associate director with the, Centre for Policy Research on Science and Technology, Simon Fraser University.