ICT Industry Growth Not Primary Goal

Industries have life cycles: birth, growth, decline. It's not GoC's role to stop that, nor to set growth or decline rates for an industry. Except insofar as encouraging an overall healthy, modern, prosperous economy. As with railways last century, ICT industry's own productivity gains — more bits and bytes delivered per $ and worker — and declining marginal value of additional production, may lead to a declining share of GDP in this century. This will allow economic resources to shift to new industries in birth and growth phases, which in turn will keep Canada's economy modern, healthy and prosperous.

Comments

Sentinel — 2010–05–27 14:26:19 EDT wrote

I am not a railroad historian, but it does seem that the Rail industry in Canada was, at least for important junctures in it's history, heavily supported by the government of Canada. As it was no doubt seen then as a way to connect commerce and communities across the country, so is the Web today seen as a way to foster digital commerce across the Globe. If peak oil is in fact looming on the horizon, will not "moving bits and bytes" as you have put it, be as important to the Canadian project as has been moving freight and bodies across our continent sized territory? If pure market economies did in fact exist everywhere (or at least within our own trading partners) I think your point would be well taken. However, our Government, and I would venture all OECD countries, DO "pick winners" and the question then becomes which "winners" to choose and not whether to choose at all.

It strikes me as self evident that Canadians must compete in the global market place if we are to maintain our increase our average standard of living. While other nation's experiment with economic tools designed to give their people and companies a competitive advantage in this immensely ubiquitous and pervasive Industry, it seems foolish to me to pick this one Industry to take a stand on pure market ideals.

I respect your position on an ideological stand point, just doesn't seem to me to be the appropriate strategy at this particular point in history.

dsanden — 2010–05–29 14:54:20 EDT wrote

Some economists and models of economic growth:
Solow: Q=f(labor,capital,technology) Schumpeter: + creative destuction, innovation, entrepreneurship Romer: (New Growth Theory) + knowledge Economic Growth Gov. favoring one industry/picking winner violates Schumpeter's creative destruction.

dsanden — 2010–06–01 18:34:31 EDT wrote

If the growth rate is positive(+) then gov help would be accelerating / helping Schumpeterian creative destruction. (but if growth wanes / goes negative, gov should bail out otherwise will be working against Schumpeterian growth).