Canada exports more research and development (R&D) services than it buys from abroad, while paying significantly more than it receives for the use of intellectual property (IP) (e.g., royalties or copyrights) derived from R&D. In contrast, the UK or US both export research services and receive net payments for the use of their IP abroad, while some Nordic countries are net buyers of research performed abroad but own and commercialize the resulting IP, like the case of the Lego research performed in Switzerland. Because productivity and income growth hinge on the commercialization of innovation, Canada needs to improve its commercialization performance to remain globally competitive. For more on addressing the gap between Canadian R&D and IP commercialization performances, see this C.D. Howe Institute research.
