Reject Mazzacuto – her empirics are anecdotal and contain factual errors

Advocates of industrial and innovation policies thus most often given the government a major role in the promotion of innovations, sustainable development and the like. One such example is Mazzucato’s book The Entrepreneurial State (2015) which argues the state’s role in innovation has been greatly underestimated. Using examples primarily from the US to show different cases where the state rather than firms started the development of aviation, nuclear energy, computers, the internet, the biotechnology revolution, nanotechnology, and various environmental technologies, she then argues that the state should take the lead in developing strategies for key sectors and technologies. Scholars have pointed out a collection of problems with Mazzucato’s argument. First, Mazzucato’s view confuses invention with innovation as the iPhone and its social and economic value was an entrepreneurial discovery made in the marketplace, not in the laboratory. Second, her argument is at best anecdotal, but even the anecdotes contain several rather serious factual errors (Sandström 2015). Third, the book does not try to infer any causality and it avoids attempts at a cost-benefit assessment of public interventions while nevertheless making bold claims about the government’s positive net contribution (Potts et al. 2016).