Specialization versus diversity in Canadian technological development

In the new era of liberalized North American trade one of Canada's goals is export-led growth in technology intensive activities. Macro-economic data show that technology intensive specializations are developing but their international success is limited. One reason is that business spends less on R&D in Canada than in most OECD countries. Problems associated with macro data have prompted the use of survey-derived data listing the high-technology products of firms in order to define technological clusters. Most of the firms comprising each cluster are small: the distribution of large producers and R&D labs and the structure of clusters are discussed. Aggregate and micro data are used to establish the localization of technology intensive industry, especially in the Toronto metropolitan region. This is the largest concentration of technology intensive firms and the importance of services as markets and as sources of technology intensive products is established. The conclusion weighs the importance of specialization versus diversity, small firm entrepreneurship versus the importance of large firms, and metropolitan attraction for high-tech firms vs. the chances of medium-sized urban centres.