Wealth Creation and the Entrepreneurial State
Building on the core ideas in the author’s book The Entrepreneurial State: debunking private vs. public sector myths, the chapter looks at the narrow way in which public policy is viewed in economics and the implications of this for our understanding of wealth creation. Focusing on the relationship between the State and innovation-led growth, it looks at the key role that public policies have had in taking on extreme risk and uncertainty in the innovation process. This has entailed the State acting not just as lender of last resort, but as investor of first resort. In this context, economic policy is more about market making and shaping, rather than just a market fixing. The chapter then focuses on the implications of this different understanding of public policy, for a more ‘collective’ understanding of wealth creation, and ways to ensure that not only risks but also rewards are socialized.