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From: brewster@watdcsu.UUCP
Newsgroups: can.politics
Subject: Re: Status of R&D in Canada
Message-ID: <3139@watdcsu.UUCP>
Date: Tue, 17-Mar-87 12:32:50 EST
Article-I.D.: watdcsu.3139
Posted: Tue Mar 17 12:32:50 1987
Date-Received: Wed, 18-Mar-87 00:58:12 EST
References: <3655@utai.UUCP> <582@geac.UUCP>
Distribution: can
Organization: U of Waterloo, Ontario
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>From: david@geac.UUCP (David Haynes)

>To me, it seems that you could paraphrase your question about R&D and place
>it in a purely Canadian context by asking, "Why is the most R&D development
>done in Ottawa or Toronto? (and maybe Vancouver)" Why not White Rock?
>Why not Sarnia?

	Ever since the success of Silicon Valley and Route 128 it has generally
	been held that high-tech development requires a fairly specific infra-
	structure.  This usually includes a set of appropriate support 
	companies, associated universities or think-tanks, well developed 
	cultural environment (plays, theatre, etc), and pleasant living 
	environment (schools, shopping facilities, open spaces, etc.)
	All four items can be found in Ottawa and Toronto (and Waterloo??),
	and this is not true of White Rock or Sarnia.

>It seems clear from that context, that R&D is done where there is a large
>enough market to sustain it and that the amount of money spent in a particular
>area is proportional to the percieved [sic] size of the market. The Canada/U.S.
>comparison invokes feelings of nationalistic pride, but does not, in
>my humble opinion, really factor into the problem.

	In terms of high-tech products the minimal acceptable marketplace
	to target for is North America, and it won't be long until your
	product has to be targeted at a world market if it wants to succeed.
	The Canada/U.S. comparison is very relevant, since in the North
	American marketplace either country should be acceptable for
	development, but as it now stands most R&D occurs in the States.

	One possible solution to this is political.   Canada could pass
	laws making it illegal for foreign countries to repatriate profits,
	but require that profits remain in Canada, which would lead to
	increased R&D in Canada.   This is not the same as FIRA, which
	worries about foreign control.    Under a repatriation scheme,
	foreigners could own as many or as large a portion of Canadian
	companies as they choose, the only limit being that any profits that
	they make from these Canadian operations must be used in Canada.
	The law could even be implemented in such a way that big brother
	in Ottawa need not constantly monitor your operations; ie if your
	profit remains in Canada tax occurs at the normal rate, every dollar
	of profit you decide to take out of Canada is taxed at twice the
	normal rate; you choose what you want to do with your profits.

	This is related to the situation in the U.S. where some states try
	to levy taxes on companies registered in their state, based on the
	companies world-wide profits.   I am not sure, but I believe that
	this has been declared illegal, presumably because of the logic
	that you should be taxed in the area where profits are made.

						   Try not  to become  a  man
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