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Monday, August 06, 2007

Wealth gap

Today's Western Mail reports that the regional wealth gap has widened between Wales and England during Labour’s 10 years in office.

According to the Institute for Public Policy Research (IPPR) Wales’ economic output has fallen even further behind that of the wealthiest part of the UK, the South East of England, since 1997. In that year Welsh GVA (Gross Value Added) – the accepted measure of wealth per head – stood at 81% of the UK average, with London on 129% and England as a whole on 102%. But in 2005, the latest figures show Wales has dropped to 78% of the UK figure, London has increased to 136% with England as a whole still on 102%.

The paper reminds us that during the second Assembly term, the Labour administration stated its aspiration was to raise the GVA level to 90% by 2010. The “One Wales” agreement between Plaid and Labour says, “Everyone must have the opportunity to achieve a reasonable standard of living, no matter where they live or what they do”, although there is no specific GVA target.

This is a massive challenge for the new Labour-Plaid Coalition and one on which they will be scrutinised quite closely. It is not helped of course by the fact that despite their strong negotiating position, Plaid failed to get a promise of any extra matched funding from the Treasury for the second phase of European funding.

In the absence of a target in 'One Wales' no doubt people will be focussing on the existing objective of 90% of UK GVA by 2010. To get there will require a massive reversal in fortunes. I hope that the Government is able to do it.
There's a HUGE problem with the way Wales PLC works. For example, take the huge investment in research (nearly half a billion a year spent on research projects at Universities in Wales). How many patents result? Some yes, but compared to non-Welsh universities the number is very low.

I took the trouble to show this to anyone who would listen at the Welsh Assembly. The only person willing to give me the time of day on this issue was Professor Williams of Plaid Cymru. So some credit to him for that. But he died a few weeks later in a massage parlor (I think on City Road) and that was that. I guess he had other things on his mind than conveying my findings to his colleagues. A senior journalist wanted to write up my findings, but I did not want to embarrass the University of Wales; I might do another research project to compare how all the research universities in Wales now compare with non-Welsh universities/patent output.

To illustrate just how bad Wales bleeds intellectual property I compared the whole of the University of Wales (I included Cardiff Uni, Swansea, the Medical School in Cardiff) in my study. I found that the University of Wales was underperforming by at least a whole order of magnitude. For example, the University of Chicago had 500 patents issued/in the pipeline compared to around 50 for the University of Wales (with the medical school having the major chunk, from memory, 38) patents. Out of the whole of the University of Wales, the Medical School scored best.

I looked at states with populations less than that of Wales - North Dakota which is largely a rural isolated state with less than about half of the population of Wales, the North Dakota state university actually compared well in terms of patent output, with about the same number of patents.

While Wales PLC bleeds intellectual property and actually strengthens outside competition there remains very little hope that Wales will lift its per capita output and will remain dependent on Objective One funding from the EU.

Honestly, one would think the Welsh Assembly would jump at the chance of listening to how it is done in more successful economies, but apparently not. Despite numerous emails and phone calls it seems that the politicians in the Assembly are full of positive words, but don't really care. I've met several politicians from England in the USA (including former PM Blair), but not one Assembly Member; except for a previous Mayor of Cardiff (who was promoting "Cities of the World" or something like that in Washington, DC) I have not discussed this F2F with Welsh politicians on this side of the wee pond, yet they visit the USA from time to time, even holiday here.
I've just checked the latest patent filings for the University of Chicago (which looking at their facts page is no larger than Cardiff University and the Medical School combined, but keep in mind that the University of Chicago is handicapped somewhat because it lacks an engineering faculty) – running Boolean (1):

an/("University of Chicago")

… the University of Chicago has 406 issued US patents and 216 US pending patents (making for about 620 issued or pending patents). This figure is below the true figure because the University of Chicago used to file patents under the banner ARCH Development Corporation (Chicago, IL); if I run the Boolean (2):

AN/"University of Chicago" OR AN/(ARCH AND Development): 760 (issued patents).

where “an” signifies assignee (hence I am not including inventors at the University of Chicago who filed in their own right). With this more accurate Boolean the University of Chicago has 760 issued patents and if I check for pending patents get:

AN/"University of Chicago": 216 (pending) patents.
an/(ARCH and Development): 33 (pending) applications.

Caveat: I suspect there will be some overlap since ARCH Development might use “University of Chicago” in the assignee field.

Keep in mind that any large institute that goes for a patent almost certainly files a copy of the patent with the US Patent Office which is one of the cheapest patent filing countries in the world (covers all 50 states of the union for one filing fee compared to filing in the EU where the fee to cover all the EU states is about 10 times higher).

Using the following Boolean algebra:

an/(University) and ic/cardiff

Which covers any assignee with "university" in the title and based in the city of Cardiff (not case sensitive) produces 61 issued patents and 11 pending applications giving a current total (as of August 6, 2007) of 72.

Even if we ignore all patents relating to ARCH Development Corporation, which puts a handicap on the University of Chicago, it is clear that the University of Chicago outperforms 8 times the University of Cardiff and the Medical School combined. With ARCH Development Corporation there is at least an order of magnitude difference - but as stated I suspect there will be some overlap since ARCH Development might use “University of Chicago” in the assignee field (would require someone to examine every assignee field to remove the overlap – but even with this caveat it is clear that Cardiff University, in comparative terms, is underperforming even with the patents from the School of Medicine are tacked on thereby boosting Cardiff University’s patent figures.
We should be grateful to Chris Wood for these insights, and to PB for evoking them.

They're so interesting that I've pasted and copied them on to my blog for a(n even) wider reading



There is more to say about it isn't there.
Old Labour and New Plaid Cymru like to think that the poor people of Wales elect them and not the Tories. As Labour / Plaid Policies, and their crawling to Westminster, will leave Wales trebly poorer by the next Wales Assembly elections they should have increased majorities if the logical thinking prevails of being elected by the poor! Clever!!!
A couple of points

First the IPPR report is another chapter added to the book of 'How poor and sick is Wales' there must be 100's of these reports sat on shelves in Cardiff Bay which state the blindingly obvious, what makes us think this report will be treated any differently?

How about something really radical, why not put the money into job creation and raising the minimum wage instead of into publishing all these reports, so the politicians can continue to use them as stalling tactics rather than taking action.

Finally on the point about Mike German and Economic Development, he was in the same situation as Ieuan Wyn Jones is now and will only be able to do what Labour will allow, the issue for Labour is that changing the economic status of individuals, often changes their political allegiances.
The Conservatives may have put Wales on its knees but its in Labour interest to keep people there.
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