Government’s role in innovation

government in innovationThis article in the New York Review of Books features two books that shed light on the central role government plays in innovation. They are Mariana Mazzucato’s The Entrepreneurial State: Debunking Public vs. Private Sector Myths, published by Anthem, and William H. Janeway’s Doing Capitalism in the Innovation Economy: Markets, Speculation and the State, published by Cambridge University Press. From research that made Apple Computer possible to the “backstop” role that the government plays in the pharmaceutical industry, these books cover it all. The sad truth is that this story about the pivotal role of government is largely untold, and the false idea that government stifles innovation is the one that dominates in the public’s mind. The Review describes this public un-awareness this way:

“ . . . US taxpayers… do not realize that corporations are making money from innovation that has been supported by their taxes.” That they are not aware of the benefits to competition seems to be a triumph of free-market ideology over good sense. How many Americans are aware that Google’s basic algorithm was developed with a National Science Foundation grant?”

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