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Canadian innovation is falling behind U.S.

Despite billions in government programs, Canada lags other developed countries, according to the Fraser Institute


Canada’s innovation performance has declined in recent years and is falling further behind the U.S. and other developed countries, despite decades of costly innovation programs by successive federal governments, according to a recent study released by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank. In fact, the current federal government allocated a staggering $8.2 billion to various innovation programs in its 2017 budget to encourage venture capital investment and create innovation superclusters, among other things.

Isometric virtual office with business people working together on innovation.

“Canada’s relatively poor innovation performance over a rather long period of time suggests that these government-dominated, top-down programs don’t work,” said Steven Globerman, Fraser Institute resident scholar, professor emeritus at Western Washington University and co-author of Innovation in Canada: An Assessment of Recent Experience.

Canada’s innovation performance has deteriorated recently

The study finds that Canada’s innovation performance has deteriorated recently compared to the U.S. and other developed countries. In fact, Canada’s relative ranking on the Global Innovation Index and the Global Competitiveness Report—two key innovation indices—is the lowest it has been since 2011 and 2008, respectively.

That means the innovation gap between Canada and other developed countries is growing. Crucially, innovation—developing new products or new ways of doing things—is key to increasing productivity and raising living standards for all Canadians.

“Clearly, the bureaucratic top-down approach to fostering innovation has failed despite the many billions Canadian taxpayers have paid for these programs over the years,” Globerman said. “Governments should focus on creating the right economic conditions within which entrepreneurs and businesses are incented to pursue innovation on their own.”

Isometric virtual office with business people working together on innovation.


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1 Comment » for Canadian innovation is falling behind U.S.
  1. Mike Lacroix says:

    I have never liked “think-tanks” as they don’t live in the real world. If increasing innovation means creating more efficiency then they can have it. To increase efficiency most companies see that as a reduction of work staff meaning less people working and a poorer living standard. Innovation is the practice of developing new products and processes that will benefit all humans without the loss or decrease in any person’s standard of living. Innovation is NOT developing new products and processes that only enrichen companies and already rich people. The problem with the “Think-tanks” is that they are very well or if not over paid and don’t experience the financial issues that face the everyday person.

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