Innovation-led growth can square a circle that is challenging modern capitalism: how to generate sustained and sustainable economic growth, built on high-value, well-paying jobs. This is at the core of entrepreneurial societies, and it is a good objective. The problem is how to get there. Although many countries have set the goal, few have achieved it.
The reason for this elusiveness lies in widespread misunderstandings about how innovation-led growth has been achieved in the past. These misunderstandings have allowed the wrong narratives to drive policy making, with individual entrepreneurs and companies as the central characters of the story. Left unchallenged, this narrative leads to counterproductive policy making and a distribution of rewards from growth that doesn’t reflect the actual distribution of risks.
An entrepreneurial society needs an entrepreneurial state, one that through visionary and strategic public investments, distributed across the innovation chain, can create animal spiritsin private businesses. Entrepreneurs then see growth opportunities, and business investment follows.Harvard Business Review
An Entrepreneurial Society Needs an Entrepreneurial State
Mariana Mazzucato | R.M. Phillips Professor in the Economics of Innovation at SPRU University of Sussex, UK