Dan Trefler gave the Innis Lecture at the meetings of the Canadian Economics Association in Vancouver a couple of weeks ago. The title of his talk was "Policies for Canadian Prosperity"; inevitably, one of the points he spent a lot of time on was the problem of Canada's slow rate of productivity growth.

One possible explanation
might take the form of a cultural antipathy to innovation: Canadians don't innovate
because it's considered to be bad manners or some such. But it's hard to reconcile that theory with the available evidence: opinion polling data suggest that attitudes towards
entrepreneurship in Canada and the US are pretty much
the same.

But
there was one question where there was a significant difference. When
asked what sort of education was required to do well in business,
Canadian managers were far more likely than their US counterparts to
say that a university degree wasn't necessary. Of course, that might be
because 70% of Canadian managers don't have a degree, while that's the
case for only 50% of US managers. As Trefler put it, "Canadian managers
are under-achievers."

This is not the sort of explanation that is easy for an economist to get one's head around, but it's worth making the effort. Not only would it explain Canada's slow rate of productivity growth, it would also explain why

1. "[F]oreign-controlled plants are more
   productive than domestic-controlled plants. Foreign-controlled plants
   and firms are also more innovative, more R&D intensive and use more
   advanced technologies,"  and "that there is not much difference
   between foreign-controlled plants and domestic-controlled plants whose
   parent has an international orientation. For R&D and innovation,
   the results indicate that domestic producers with foreign operations
   … actually have a slightly better performance." (From this post). The only occasions in which Canadian managers perform well are when they are obliged to deal directly with foreign competition.
2. "Canadian investors are selling their shares in Canadian companies and
   buying stocks in other countries. Since 2000, Canadian net purchases of
   foreign stocks were about $C 60b more than foreigners' purchases of
   Canadian stocks." (From this post.) Canadian investors are divesting themselves of badly-managed domestic firms.