The Economic Role of Research and Development - Essay Example

?The Economic Role of R & D The world has considerably improved over the last decade. Massive technological advances have practically flooded the global economy beginning at the turn of the century revolutionizing the way almost every human activity from communications, business transactions and even modernizing warfare. So much have been said of the United States which has basically been the leading economy in the world and the remaining military superpower of today as well as that of the British and of course the technologically savvy Japanese. Even the emerging power China has had its share of the spotlight breathing closely on the United States and seemingly poised to take the helm of the lead in the global economy. However, behind all these, Canada seems to have been a very quiet spectator seeming lagging on the development bandwagon. The country seems to have been a very quite neighbour, dwarfed by the gigantic research and development machinery of the United States. Sancton1 abhors the seemingly backwardness and lack of initiative on the Canadian government to invest in research and development comparing the cities’ innovations that are left wanting as well as the seemingly lack of political will to support such investments that will lead to economic development. However, it is quite unfair to match the two nations evenly since there is a large difference between the dollars allotted by Americans to research and development than Canadians. Hence, it is only fair for any country with lesser resources to allocate these much more intelligently and therefore focus of the much needed improvements that are essential for the betterment of their constituents. Thus, even governments and non-profit organizations have adopted the use of the balanced scorecard (BSC) postulated by Kaplan and Norton in order to be able to have a more strategically planned allocation of these resources. Of course these institutions work on a limited funding whereby there are the limitations of taxes and grants respectively2. Hence, in light of the aforementioned limitations, Canada cannot go toe-to-toe with its giant neighbour in terms of research spending. However, as Clark brings forward, the country has more consciously focused their research efforts in order to have more impact and to be able to bring in more economic developments given the limited amount of funding available3. A Parallel Flux There has been an increasingly similarity though on the forces that affect the two countries. The impact of the forces has steadily been having the same effect on the US and Canada whereby there has been an increasing similarity in the responses of the two countries as the effects of such forces affect the two countries in almost the same way. However, as mentioned, the capability of the latter seem wanting as compared to the former4. Indeed, Canada needs to step up on the research and development area since the competition globally has likewise become stiffer. Of course Canadians will want to enjoy the same economic prosperity by the other countries, especially its peers among the advanced economies. There have been improvements that have crept at towards the close of the last century5. However, these changes have not moved fast when the speed of the global economy shifted to a higher gear when the technological innovations kicked in during the past decade. Indeed, the only effect of the housing crisis of the US in Canada was the dampening in the demand for housing needs, particularly lumber, which goes to show the extent to the disparity between the neighbouring economies. Focused Improvement In effect, the country has to really focus its efforts to improve their research and technology. Basically, economics is about allocating scarce resources and Canada knows that compared to its giant neighbour, their resources are indeed lacking. However, research truly involves more than funding since it also involves the intelligence of researchers and of course their creativity which cannot always be calibrated. But, given the realities, the country ought to choose and pay the opportunity costs of the choices that they will make. Researchers need money and so does the institutions that house and equip them. Canada must realize this hard reality and make the necessary choices that will guide their investments. It is also important to note that the pressing need for funding may drive these people elsewhere. Indeed, these are part of the special group of people that have come to be known as knowledge workers. These people cannot be simply confined to office spaces and office hours6. Moreover, these researchers will not stand idly by and wait for their innovations to be granted funding which opens up the threat that these brilliant minds may be lost to the higher bidder. Hence, it is important for the Canada and her economy to be able to prioritize and ensure that the country’s taxes can be funnelled into the most pressing projects that can help in the economic development that will impact their citizens the strongest. Indeed, there has been a strong need for political force to help shape the flow of these funds in such a way that it can generate the most economic benefits to support local development7. True, challenges abound and the competing forces for these funds cannot be easily satisfied. Still, the government must choose if they are to move strongly forward. Policies must be written down and implemented if the country’s research and development efforts can move strongly forward. The government can find clues in the cross border channels in order to gauge and properly calibrate their actions so that such policies and be both timely and increasingly accurate8. Getting it Right In the end, it is all about balance and getting the right mix right. There has to be compromises but the chosen path of economic development through research and development must be properly analyzed but must likewise be timely implemented. Indeed, there must be a concerted effort from all concerned to identify and exploit areas, such as business clusters, that can offer the best possibly competitive advantage9. In the age of globalization, this has been key since international trade and competition has been shaped and governed by this competitive advantage. Hence, the efforts of Canada must be attuned to this pressing reality and the bickering between researchers and the institutions that house them must be satisfied by striking a balance between these two entities. Moreover, the decision must come now and with it the issues must be out to rest. The rise of China should sound the alarm as this developing nation has practically edged out most advanced economies including Canada. Technology has been a very important force for economic development and innovations must be made in order to ensure a country’s sustainability. Thus, funding in education and in being able to innovate has become among the foremost tools in such a competitive environment10. In this light, it is very important for Canada to make her choice and to decisively implement this choice in order to have a real and sustainable economic development that nowadays must be aided by massive improvements through research and development. References Christiansen, C., Johnson, C. and Horn, M. (2008). Disruptive Class: How Disruptive Innovation will Change Education. Mc Graw-Hill. Clark, J. (2008). A conscious geography: The role of research centers in the coordination of Innovation Policy and Regional Economic Development in the US and Canada. Retrieved on August 5, 2011 from http://www.spp.gatech.edu/faculty/workingpapers/wp42.pdf Hill, E. W., & Brennan, J. F. (2000). A methodology for identifying the drivers of industrial clusters. Economic Development Quarterly, 14, 65–96. Mossberger, K., & Wolman, H. (2003). Policy transfer as a form of prospective policy evaluation: Challenges and recommendations. Public Administration Review, 63, 428-440 Niven, P. (2003). Balanced Scorecard Step-By-Step for Government and Nonprofit Agencies. John Wiley & Sons. Reese, L. A., & Rosenfeld, R. A. (2002). The Civic Culture of Local Economic Development. Thousand Oaks, CA: Sage. Rothblatt, D. N. (1994). North American metropolitan planning: Canadian and U.S. perspectives. Journal of the American Planning Association, 60, 501-520. Sancton, D. (1983). Conclusion: Canadian city politics in comparative perspective. In W. Magusson & A. Sancton (Eds.), City government in Canada, pp. 291-317. Toronto, Canada: University of Toronto Press. Serrat, E., A.D.B. (2008). Managing knowledge workers. Retrieved on August 5, 2011 from http://www.adb.org/Documents/Information/Knowledge-Solutions/Managing-Knowledge-Workers.pdf Smart, A. (1994). Recent developments in the theory of the state and the changing Canadian metropolis: Implications of each for the other. In F. Frisken (Ed.), The Changing Canadian metropolis: A Public Policy perspective (pp. 561-579). Berkeley, CA: Institute of Governmental Studies Press. Read More