Leveraging science and technology to build a stronger economy

Robert Asselin’s testimony to the House of Commons Committee on Science and Research

Le progrès scientifique est l’un des déterminants économiques clés de notre avenir. En termes simples, la capacité des états à transformer leur capital intellectuel en croissance économique est dorénavant un facteur déterminant de leur réussite technologique, industrielle et économique.

Policymakers need to acknowledge that scientific knowledge and science-based institutions are more than just public goods; they are essential economic enablers in a world of increased geopolitical competition.

Consequently, the ways we do science — how we empower our best scientists and researchers to do frontier work on the most pressing challenges we face, and how we facilitate that knowledge transfer in the real economy — must become central to how we conceptualize our growth potential as a country.

As a country, Canada has emphasized publicly funded research and development (R&D) as a driver of its innovation policy. As a whole, the economic returns have been insufficient, as Canada’s low productivity metrics over the last few decades show. Canada has put too many eggs in that one basket.

The goal of innovation economics is to amass innovation assets — IP, data and the talent that creates it — and then to exploit those assets when the assets are commercialized. Creating innovation assets and then divesting them before commercialization or losing out on the potential to grow companies to global scale is a failure of innovation policy. This is the difference between being a landlord nation and a tenant nation in the new intangibles economy.

Canada currently does not have sufficient and adequate mechanisms to translate R&D/ideas into the real economy. No matter what financial instrument is deployed, public “investments” won’t produce better outcomes if we don’t change the way we think, incentivize and produce innovation.

Cette fausse conception que nous avons de voir l’innovation comme principalement un processus d’adoption technologique signifie que le Canada laisse une quantité considérable de richesse économique sur la table.

C’est pourquoi il nous faut développer notre capacité en recherche appliquée et industrielle à grande échelle et créer des mécanismes de transfert de technologies.

Le modèle scientifique que nous avons adopté après la Seconde Guerre mondiale ne constitue plus un cadre adéquat pour le paradigme économique actuel. En adoptant ce modèle, on a supposé que le transfert de la recherche publique aux entreprises privées serait automatique. Aujourd’hui, nous savons que le financement de la recherche fondamentale n’est pas suffisant pour atteindre de meilleurs résultats en matière d’innovation.

Bâtir les courroies de transmission afin de traduire les connaissances scientifiques générées dans les universités en progrès technologiques, industriels et économiques est plus difficile à réaliser dans la pratique qu’en théorie. L’impératif académique de publier dans des revues scientifiques prestigieuses est certes importante et devrait être encouragée, mais il en va de même pour la création de la propriété intellectuelle. Nous ne produisons tout simplement pas assez de brevets au Canada. 

The innovation ecosystem emerging from the last decades has been characterized by a deepening division of innovative labour between universities and private firms. Universities have been essentially tasked with focusing on research while industry has been left with the application of science and technology. The problem is that using the output of university research still requires significant coordination and integration.

In the current configuration, the federal government provides funds for research and assumes this knowledge will naturally make its way to industry. It neglects all the necessary steps to commercialization — development, prototyping, testing, demonstration, product implementation and diffusion — that are necessary to complete the innovation process.

In the United States, the golden age of large industrial labs — Bell Labs, IBM, GE, DuPont — played a key role in the commercialization of R&D from the ’50s to the ’80s. But Canada never cultivated that kind of R&D industrial capacity, and where it did, like Bell Northern, it has been lost. Ensuring research is plugged into innovation networks is a critical function of an effective industrial policy.

We have long thought R&D was innovation. From R&D to development through production, application and diffusion, the road to innovation is long and hard. An intentional industrial policy requires a new institutional infrastructure to support the modern application of science and technology in highly competitive and advanced industries, and an approach focused on mandated missions.