This is not new since Mariana Mazzucato’s breezy pamphlet, The Entrepreneurial State, was published a year ago, but it was new to me. I’ve just finishing reading it, having snagged one of the copies that she brought to June’s fascinating Science Question Time on economic growth.
The Entrepreneurial State is a welcome addition to the debate on the value of public investment in science as a factor in economic growth because it opens up what was for this reader at least a relatively uncharted dimension of the argument.
The case for public spending on basic R&D is taken as read. Rather what Mazzucato is keen to address is the role of the state in enabling research discoveries to be developed into new products and even, in the most influential cases, new markets. Rather than simply charting the well-known anecdotes of blue-skies research leading to successful businesses (admirably covered in the 2010 Royal Society Report, The Scientific Century), this short book aims to dissect how that process happens most effectively.
In particular, drawing largely on examples from the US, it addresses head-on the claim that the vitality of private companies and venture capitalists is largely responsible for the successful commercialisation of scientific research. Instead, contends Mazzucato, it takes a visionary, risk-taking state to make the long-term investments needed to join up science with enterprise.
I won’t rehearse the arguments; it is easier and quicker to quote the conclusion:
A core lesson of this pamphlet is the need to develop a new industrial policy which learns from the past experiences in which the state has played a leading, entrepreneurial, role in achieving innovation-led growth. State-funded organisations (mainly decentralised ones such as DARPA*, SBIR* and so on) have been fundamentally involved in generating radically new products and processes, which have changed the way that businesses operate and citizens live—transforming economies forever, from the internet revolution to the biotech revolution to what (it is hoped) will be the greentech revolution. It has also been argued that a core way to tackle smart and inclusive growth together is to ensure that the gains from innovation are just as collective as the risk-taking underlying it is.
In seeking innovation-led growth, it is fundamental to understand the important roles that both the public and private sector can play. This requires not only understanding the different ecologies between the public and private sector, but especially rethinking what it is that the public is bringing to that ecology. The assumption that the public sector can at best incentivise private sector led innovation (through subsidies, tax reductions, carbon pricing, green investment banks and so on) — a claim being propagated heavily in the UK, especially but not only in the face of the recent crisis and ensuing deficits — fails to account for the many examples in which the leading entrepreneurial force came from the state rather than from the private sector.
Or you can read a synopsis that Mazzucato wrote for the New Statesman.
I found it an engaging read, but the thesis advanced in The Entrepreneurial State may be uncomfortable for some scientists since it emphasises the role of mission-oriented direction of funding (albeit in a decentralised form via agencies at arms length from government). Science Minister David Willetts has clearly read the pamphlet because he referred to it in his policy speech from Jan 2012. At the time — without realising its source — I noted a shift in thinking towards a more directed policy where government would target technologies for investment.
That may sound a bit too much like the impact agenda writ large. For now, it is not clear whether the message has really been taken on board; it still seems as if Osborne’s austerity plan trumps any grander vision for the future (a view shared by the Science Question Time panel). But the scientific community has to be smart enough to engage with the technicalities of this debate, especially in the run-up to the next Comprehensive Spending Review when the case will have to be made once again for the science budget.
In preparation for that, you could do worse than read The Entrepreneurial State, which you can download it as a free PDF. You might also want to consider coming along to the Science is Vital AGM in September, where the funding challenges that lie ahead will be discussed.
*DARPA - Defense Advanced Research Projects Agency; SBIR - Small Business Innovation Research. Both are US government agencies with broad remits to foster the development and commercialisation of new technologies.