Public Budget and Entrepreneurial State

Innovation and entrepreneurship as a source of economic growth are an undisputed recipe. Private entrepreneurs, Steve Jobs as the archetype, and the venture capital are presented as examples to follow.

Less frequent it is to recognize the role of the State, with resources provided by taxpayers, as a key player on most important innovations. This is what professor Mariana Mazzucato does brilliantly in her book “The Entrepreneurial State”. Thus, says that 12 fundamental technologies for work the iPhone and iPads, from Internet to mobile technology networks and liquid crystal screens and lithium batteries, are result of publicly funded research. The undisputed genius of Jobs consisted in integrating them and present them in extremely attractive forms for customers, transforming Apple in a corporate icon.

When is under debate the 2015 budget and reducing expenditure is the predominant mantra, it is well worth remembering the State essential role in scientific research, while senior executives and shareholders are the big beneficiaries in the distribution of the innovation profits, since they come in phases more mature of the innovative process, when the risk is lower and the project has crossed the death valley in which many investments in research and development end.

We are faced with a governance problem. It corresponds to parliaments give answers promoting sustainability innovation and equity in the distribution of its benefits. Invest in research in times of crisis, as well as losing the fear of failure and assume their cost, requires a change of mentality against the role of the public sector in the economy that need to be promoted. It is one thing to manage public services, where prudence is a virtue, another discover new drugs or sources of energy in which the dialectic trial and error is the standard. On how to do this can illustrate the U.S. Agency ARPA-e, which looks for new energy technologies and to which web brings us Google, with an algorithm also publicly funded.

It is time to agree on some rules that recognize the role of the entrepreneur State so that the rhetoric of innovation will match reality.

 

Enric R.Bartlett Castellà

Associate Profesor of Public Law

ESADE Law School (Ramon Llull University)

 

This article was published in Catalan and Spanish on November 13 2014 in La Vanguardia

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