The Science, Technology and Innovation Council (STIC) released its bi-annual report last week, continuing the tradition of ‘groupthink’ evident in its previous two reports. To be fair, measuring innovation is an impossible task, since it includes everything from product innovations to new processes and technology to marketing and organizational structures.
Inevitably the report’s primary focus is on some of the inputs into the process of innovation (like research and development (R&D)), and not the outcome, which hopefully is more innovation. But unless we can say what successful innovation is and measure it, monitoring a partial list of inputs is hardly satisfying. By focusing on those things that can be quantified, the report makes a commonplace but fundamental error of social science that anything that can’t be counted doesn’t count. Friedrich Hayek devoted his Nobel Prize acceptance speech to the errors of analysis along exactly these lines.
The report discusses things largely because data about them exist, even though what is being measured is only partly or tangentially related to innovation. The most obvious example is R&D, to which whole chapters are devoted.
There is not enough discussion of the pitfalls and limitations of relying on R&D to understand innovation. The report acknowledges that “the significant investments that Canada’s natural resource industries make in exploration and evaluation activities and in field testing facilities” are not counted as R&D, but clearly are innovative. However, that is the last we hear of the problem of this type of ‘hidden’ innovation.
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