Saturday, December 29, 2007

Canadians Too Lazy to Invent?

A recent op-ed in the Globe and Mail (Dec. 27) uses patent statistics to make the case that Canada, in general, and the province of Alberta, specifically, needs to focus more on math, science and the creative arts in schools in order to ensure future prosperity. The writer argues that since Canada is about one-tenth the size of the U.S., Canadian inventors should have been granted 240,000 U.S. patents over the last twenty years. Instead, they have received only 77,594.

Although I agree that Canada needs to do more to cultivate innovation rather than rely on natural resources for economic growth, I'm generally skeptical about such comparisons. In fact, I believe that patent statistics show that Canadians are among the most inventive, creative people in the world.

Let's take a broader look at patenting trends among the G8 countries over the last few years. With just over 33 million people, Canada is the smallest country in the G8, yet since 2000 Canadian inventors have been granted nearly as many U.S. patents as their counterparts in France and Great Britain, which have populations almost twice as large. In terms of the per capita number of patents issued, Canada, with about 1000 people per patent, ranks second after Japan (488:1) and Germany (857:1) and well ahead of France (1702:1), Italy (3458:1) and Russia (60991:1).

A much more interesting statistic, in my opinion, is the fact that Canadian residents apply for and receive far fewer patents in Canada than the U.S. In 2006, Canadian inventors filed 10,243 U.S. patent applications and were granted 3,743 patents, but filed only 5,348 Canadian patent applications and received 1,495 patents. Obviously, this might be explained by the fact that Canadian inventors believe they can get more bang for their buck in the U.S., where the consumer and venture capital markets are much larger.

Table 1. G8 Patenting Trends, 2000-2007*

Country / Pop. / U.S. Patents

Canada / 33,390,141 / 34,702
France / 60,876,136 / 35,765
Germany / 82,400,996 / 96,102
Italy / 58,147,733 / 16,814
Japan / 127,433,494 / 289,628
Russia / 141,377,752 / 2,318
United Kingdom / 60,776,238 / 38,579
United States / 300,000,000 / 668,807

*Based on data from USPTO patent databases and annual reports.