How to Debunk Myths About the Public Sector and Achieve More Inclusive Growth 

How many times do we hear that to increase innovation and competitiveness, we need more market and less state? This commonplace position ignores history: the IT, biotech, nanotech and emerging ‘green’ revolutions have all been initiated by a courageous public sector, willing to invest – and imagine a new landscape – long before the private sector stepped in. This might sound counterintuitive, as it contradicts the narrative that innovation is mainly created in the efficient private sector – while the slow and bureaucratic public sector should best fix market failures, set frameworks, and then learn to step aside. According to economist Mariana Mazzucato, these stereotypes put future innovation at risk and fuel inequality. By ignoring the public contribution, risks end up being socialised while profits are privatised. Mazzucato advises governments world-wide on industrial policy and innovation-led growth, and is on two expert groups in the European Commission dedicated to innovation policy. In 2013 she was called by the New Republic “one of the most important thinkers of innovation”; her latest work on The Entrepreneurial State: debunking private versus public sector myths received widespread praise from international critics and was featured in best books of the year lists in the Financial Times and Forbes, with the German translation shortlisted for the Wirtschaftsbuchpreis. At Falling Walls, Mazzucato shows how a radically different understanding of the role of the public sector can benefit future innovation and foster growth that is both more sustainable and inclusive.

Mariana Mazzucato

University of Sussex

Mazzucato’s new work on the “Entrepreneurial State: debunking private vs. public myths in innovation”, building on her high impact DEMOS report, came out in June 2013. She is also Visiting Professor in the Economics of Innovation at the Open University (UK); the Economics Director of the ESRC Centre for Social and Economic Research of Innovation in Genomics (INNOGEN); and Scientific Coordinator of a 3 year European Commission funded FP7 project on Finance, Innovation and Growth (FINNOV, 2009-2012). She advises the UK government on industrial policy and financial market reform, and is on two expert groups in the European Commission dedicated to innovation led growth. Her research focuses on the relationship between innovation, finance and growth, and economic policies that can ensure that economic growth is not only ‘smart’ but also inclusive and sustainable.