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Book Title: The entrepreneurial State: Debunking Public vs Private Sector Myth
(Ch.4 & 5)
Author: Mariana Mazzucato
Student: PHD 14407
GRIPS
October 2014
OUTLINE
General Summary
The US Entrepreneurial state
General Summary
There is notion that free market is efficient system to drive economic growth and
state need to interfere only to fix market failure leaving entrepreneurship and
innovation to the private sector.
DARPA (1958)
It has budget for more than $ 3 billion per year
Funded beyond basic science,
Interaction between public and private agents led to the development such as
computers, jet plane, civilian nuclear energy, lasers and biotechnology.
Providing funding assistance to researchers, scientists and engineers to propose
innovative ideas
Funded formation of computer science department, provided startup firms with
early research support, contributed to semiconductor research and support
human computer interface research and over saw the early stage of internet.
Government acted as a major customer for the products produced by these firms
eg semi conductor
SBIR (1980s )
The program provided more than$ 2 billion a year to support high-tech firms
Setting consortium between the SB and different government agencies
Government agencies with large research budget to designate a fraction of
their research funds to support small business.
Local governments and state funded organizations to assist entrepreneurs to
submit successful application to SBIR to secure funds for their projects
As a result SBIR has fostered development of new entrepreneur and
commercialization of hundreds of new technology from laboratory to the market.
Orphan Drugs
1983 passed ODA to help small, dedicated industries
The Act includes certain tax incentives, R&B subsidies, fast track approval,
strong intellectual and marketing rights
This ODA has helped to development of biotech industry
The government is major investor in knowledge creation, subsidizer of
drug development, protector of market and purchaser of drugs
Government has played role in protecting intellectual property of companies like apple and
helped to access global market
Provide various other types of tax and procurement support such as research and experiment
tax credit, R&D Tax credit
The conclusion is that the core technology embedded in Apples innovative products are
results of decades of federal support for innovation. State investment in support of research
by state and military played a key role.
Leeson learned
Key massage
Having national system of innovation is not enough. More results can be achieved
when the state is major player. Thr state through its various agencies and
laboratories have potential to agencies and laboratories have potential to desminate
new ideas. It can also use procurement commisiong an regulatory fanctions to
shape markets and drive technological advances.
Most of innovations ware successful because of government support in one way or
another. The government has been introducing idea, coordinating, funding and
proctecting to incourage innovation. The US Government has been for years using
its resources and agencies to support novation in the private secto. Through varios
programs managed to support innovation in the strategic areas.
Because most of private sector and venture capital can not invest in resercha and
developmeni in which
THANK YOU!
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