The Entrepreneurial State explores the leading role that the State has played in generating innovation and economic growth in modern capitalism. It began as a collaboration with the UK think tank DEMOS, and is now part of a new project funded by the Ford Foundation (Reforming Global Finance). This second phase of the project will include a new book, to be published by Anthem Press, in Spring 2013.
This book debunks the myth of a dynamic private sector vs. a sluggish public sector by providing a detailed account of the role of the public sector in taking on high-risk entrepreneurial investments, from the Internet to the green revolution. Why is it that while every technology that makes the iPhone so 'smart' was funded by the State (internet, GPS, touch screen display, SIRI personal assistant), Apple pays so little tax in the US? The book focuses on this risk-reward problem whereby risk in innovation is increasingly socialised while rewards are increasingly privatized. Read the book in Summer 2013 to find out what can be done to transform this dysfunctional system so that the innovation 'eco-system' becomes less parasitic and more symbiotic!
The DEMOS version of the Entrepreneurial State (less than half the size of the new book) was launched on July 11, 2011 in the UK House of Commons. It argues that the juxtaposition of an inertial bureaucratic state versus a dynamic innovative private sector is a myth that has been created to serve ideological aims rather than scientific analysis. The economists’ tool box for understanding the state’s role has been limited to one of ‘market failure’ where the state simply fixes problems. The book argues that the state and innovation has been more about market making and market shaping than market fixing.
“It is about admitting that in many cases, it has in fact been the state not the private sector that has had the vision for strategic change, daring to think – against all odds – about the ‘impossible’, creating a new technological opportunity, making the large necessary investments, and enabling a decentralised network of actors to enable the risky research, and to allow the development and commercialisation process to occur in a dynamic way.” (p. 20)