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catincaciornei's review
4.0
Mrs. Mazzucato's "The Entrepreneurial State" added materially to my understanding of how the world works - few reads can boast such result. The State gets hammered in PR and marketing, nevertheless it was and must continue to be the main supporter of innovation in any economy. The State is the only agent powerful (rich & stable) enough and motivated enough (long term) to support decades of expensive, risky research and development needed to find, test and market new technologies; the private sector touts its flag, pushes its own agenda and brags about its dynamism and efficiency, but it is in fact a risk-adverse short-term profit-oriented actor. Mrs. Mazzucato writes a sometimes dry economic paper, fact based, academically researched and advocated, giving examples of successful private companies piggyback riding on the State's prior silent decades of investment, research, failures and networking. Interesting, fact-full, eye opening read. Looking forward to Mrs. Mazzucato's other books.
jaguridi's review
3.0
Interesante pero a ratos extremadamente panfletero. Tiene datos útiles y rescatables pero me esperaba otra cosa, no que enfatizara el rol de estado como financista de la innovación.
sethdmichaels's review
3.0
Dry and wonky, pretty academic, but puts forth a provocative theory about the comparative role of the public and private sectors in innovation - specifically, that innovation and economic growth is not stifled by, but indeed depends upon, an active public sector that invests where private actors can't or won't. Of particular interest in sectors like medicine and climate/energy. Recommended if you like that sort of thing, though it's not exactly a barrel of monkeys to read.
wilte's review
4.0
Powerful book that hammers home an important point: the State plays and has played a pivotal and vital role in innovation that is very under-appreciated; many break-troughs and innovations are the result of the state taking risks and investing money.
Mazzucato convincingly shows that even darling Apple is much indebted to technology done by and paid for by the government. Forcefully debunks many myths, like the risk-appetite of venture capital (pretty short-term and not too high risk appetite) and that a major role for the state would be communist (No, most successful capitalist economies have had active States).
Great book with clear and convincing argument, based on sound (economic) research.
page 37 As eloquently argued by Keynes in the The End of Laissez Faire (1926, xxx), ‘The important thing for Government is not to do things which individuals are doing already, and to do them a little better or a little worse; but to do those things which at present are not done at all.’
page 49 From the development of aviation, nuclear energy, computers, the Internet, biotechnology, and today’s developments in green technology, it is, and has been, the State – not the private sector – that has kick-started and developed the engine of growth, because of its willingness to take risks in areas where the private sector has been too risk averse.
page 141 Apple concentrates its ingenuity not on developing new technologies and components, but on integrating them into an innovative architecture: its great in-house innovative product designs are, like that of many ‘smart phone’ producers, based on technologies that are mostly invented somewhere else, often backed by tax dollars.
page 152 Apple’s new generation of iPods, iPhones and iPads have been built under the assumption that new consumer needs and preferences can be invented by hybridizing existing technologies developed after decades of government support.
page 157 Apple is on the verge of building the future for information and communication industry based on the radically complex ideas and technologies conceived and patiently fostered by the government.
page 160 Source: Author’s own drawing based on the OSTP diagram ‘Impact on Basic Research on Innovation’ that illustrates the benefits of basic research on innovation (2006, 8).
page 163 In sum, ‘finding what you love’ and doing it while also being ‘foolish’ is much easier in a country in which the State plays the pivotal serious role of taking on the development of high-risk technologies, making the early, large and high-risk investments, and then sustaining them until such time that the later-stage private actors can appear to ‘play around and have fun’. Thus, while ‘free market’ pundits continue to warn of the danger of government ‘picking winners’, it can be said that various US government policies laid the foundation that provided Apple with the tools to become a major industry player in one of the most dynamic high-tech industries of the twenty-first century so far.
page 222 One of the biggest challenges for the future, in both cleantech and whatever tech follows it, will be to make sure that in building collaborative ecosystems, we do not only socialize the risks but also the rewards. It is only in this way that the innovation cycle will be sustainable over time, both economically and politically. Politically it is important for taxpayers to understand how they benefit from the massive State investments that build the foundation for future private profits. As jobs are increasingly global, rather than resisting this with nationalistic dogma, there are concrete ways for returns from State investments to be captured so that the citizens who funded technological development can be sure to share in the gains.
page 242 in 2012, the compensation package for these Apple executives was $411.5 million. To put this in greater perspective, the average employee at Foxconn earns $4,622 annually, meaning the top 9 executives earned the same amount of money as 95,000 workers did in 2011 and 89,000 workers did in 2012.
page 252 Future competitiveness – consequently the socioeconomic prosperity – of nations and regions is highly dependent on their ability to maintain their most valued asset: the innovation ecosystem that they are part of. Given, however, that the innovation game can also be rigged, it is crucial to understand not only how to build an effective innovation ‘ecosystem’, but also and perhaps especially, how to transform that ecosystem so that it is symbiotic rather than ‘parasitic’, so that public–private partnerships increase the stake, commitment and return of all players investing in the innovation game.
page 256 After the financial crisis, many have rightly noted that finance has increasingly privatized the rewards of their activities while socializing the risk (Alessandri and Haldane 2009).
page 258 Shareholder-value ideology is based on this notion of shareholders as the ‘residual claimants’ and thus the lead risk takers with no guaranteed rate of return
page 259 Yet this framework assumes that other agents in the system (taxpayers, workers) do have a guaranteed rate of return, amongst other things ignoring the fact that some of the riskiest investments by government have no guarantee at all: for every successful investment that leads to a new technology like the Internet, there are a host of failed investments – precisely because innovation is so uncertain. But reducing the ability of the State to either collect tax, or to receive its fair share from the returns, hurts its future ability to take such risk
page 267 the most successful capitalist economies have had active States, making such risky investments, and we have been too quick to criticize them when things go wrong (e.g. Concorde) and too slow to reward them when things go right (e.g. the Internet).
page 270 What distinguishes the State is of course not only its mission but also the different tools and means that it has to deploy the mission. In Karl Polanyi’s epic book The Great Transformation (1944), he argued the State created – pushing, not only nudging – the most ‘capitalist’ of all markets, the ‘national market’ (while local and international ones have predated capitalism). The capitalist economy will always be subordinate to the State and subject to its changes. Thus rather than relying on the false dream that ‘markets’ will run the world optimally for us ‘if we just let them alone’, policymakers must better learn how to efficiently use the tools and means to shape and create markets – making things happen that otherwise would not. And making sure those things are things we need.
Mazzucato convincingly shows that even darling Apple is much indebted to technology done by and paid for by the government. Forcefully debunks many myths, like the risk-appetite of venture capital (pretty short-term and not too high risk appetite) and that a major role for the state would be communist (No, most successful capitalist economies have had active States).
Great book with clear and convincing argument, based on sound (economic) research.
page 37 As eloquently argued by Keynes in the The End of Laissez Faire (1926, xxx), ‘The important thing for Government is not to do things which individuals are doing already, and to do them a little better or a little worse; but to do those things which at present are not done at all.’
page 49 From the development of aviation, nuclear energy, computers, the Internet, biotechnology, and today’s developments in green technology, it is, and has been, the State – not the private sector – that has kick-started and developed the engine of growth, because of its willingness to take risks in areas where the private sector has been too risk averse.
page 141 Apple concentrates its ingenuity not on developing new technologies and components, but on integrating them into an innovative architecture: its great in-house innovative product designs are, like that of many ‘smart phone’ producers, based on technologies that are mostly invented somewhere else, often backed by tax dollars.
page 152 Apple’s new generation of iPods, iPhones and iPads have been built under the assumption that new consumer needs and preferences can be invented by hybridizing existing technologies developed after decades of government support.
page 157 Apple is on the verge of building the future for information and communication industry based on the radically complex ideas and technologies conceived and patiently fostered by the government.
page 160 Source: Author’s own drawing based on the OSTP diagram ‘Impact on Basic Research on Innovation’ that illustrates the benefits of basic research on innovation (2006, 8).
page 163 In sum, ‘finding what you love’ and doing it while also being ‘foolish’ is much easier in a country in which the State plays the pivotal serious role of taking on the development of high-risk technologies, making the early, large and high-risk investments, and then sustaining them until such time that the later-stage private actors can appear to ‘play around and have fun’. Thus, while ‘free market’ pundits continue to warn of the danger of government ‘picking winners’, it can be said that various US government policies laid the foundation that provided Apple with the tools to become a major industry player in one of the most dynamic high-tech industries of the twenty-first century so far.
page 222 One of the biggest challenges for the future, in both cleantech and whatever tech follows it, will be to make sure that in building collaborative ecosystems, we do not only socialize the risks but also the rewards. It is only in this way that the innovation cycle will be sustainable over time, both economically and politically. Politically it is important for taxpayers to understand how they benefit from the massive State investments that build the foundation for future private profits. As jobs are increasingly global, rather than resisting this with nationalistic dogma, there are concrete ways for returns from State investments to be captured so that the citizens who funded technological development can be sure to share in the gains.
page 242 in 2012, the compensation package for these Apple executives was $411.5 million. To put this in greater perspective, the average employee at Foxconn earns $4,622 annually, meaning the top 9 executives earned the same amount of money as 95,000 workers did in 2011 and 89,000 workers did in 2012.
page 252 Future competitiveness – consequently the socioeconomic prosperity – of nations and regions is highly dependent on their ability to maintain their most valued asset: the innovation ecosystem that they are part of. Given, however, that the innovation game can also be rigged, it is crucial to understand not only how to build an effective innovation ‘ecosystem’, but also and perhaps especially, how to transform that ecosystem so that it is symbiotic rather than ‘parasitic’, so that public–private partnerships increase the stake, commitment and return of all players investing in the innovation game.
page 256 After the financial crisis, many have rightly noted that finance has increasingly privatized the rewards of their activities while socializing the risk (Alessandri and Haldane 2009).
page 258 Shareholder-value ideology is based on this notion of shareholders as the ‘residual claimants’ and thus the lead risk takers with no guaranteed rate of return
page 259 Yet this framework assumes that other agents in the system (taxpayers, workers) do have a guaranteed rate of return, amongst other things ignoring the fact that some of the riskiest investments by government have no guarantee at all: for every successful investment that leads to a new technology like the Internet, there are a host of failed investments – precisely because innovation is so uncertain. But reducing the ability of the State to either collect tax, or to receive its fair share from the returns, hurts its future ability to take such risk
page 267 the most successful capitalist economies have had active States, making such risky investments, and we have been too quick to criticize them when things go wrong (e.g. Concorde) and too slow to reward them when things go right (e.g. the Internet).
page 270 What distinguishes the State is of course not only its mission but also the different tools and means that it has to deploy the mission. In Karl Polanyi’s epic book The Great Transformation (1944), he argued the State created – pushing, not only nudging – the most ‘capitalist’ of all markets, the ‘national market’ (while local and international ones have predated capitalism). The capitalist economy will always be subordinate to the State and subject to its changes. Thus rather than relying on the false dream that ‘markets’ will run the world optimally for us ‘if we just let them alone’, policymakers must better learn how to efficiently use the tools and means to shape and create markets – making things happen that otherwise would not. And making sure those things are things we need.
apattonbooks's review
5.0
This might be the most important economic book I have read in a couple of years. Makes a fantastic argument about the role of government has on innovation and how common innovations we now take for granted existed as Darpa projects.
miguelf's review
4.0
Mazzucato makes a very convincing case for continued State support of investment into key R&D initiatives, where government has showed a strong string of successes throughout the past 100 years. She demonstrates how prior government funded programs and initiatives have paid back private industry and society in the form of key technologies and platforms. One need look no further than the Internet to see this.
In engineering management graduate work (not exactly a bastion of progressive thought), one comes across numerous DARPA related projects that are viewed as great successes. Yet conservatives will scream to the hilt about examples like Solyndra (which Mazzucato addresses fully) that show that the Govt can’t invest correctly, essentially saying that the Govt must bat 100% with every investment dollar, while private equity has a success rate that often falls short (also conservatives have no problem with privatizing gains but socializing losses when the values are high enough – see the ’08 crash and the current Covid bailouts as examples). Mazzucato argues how Govt is best positioned for a number of important areas for funding – areas that private industry views as too risky to take on and where scale is needed (fusion research as a quintessential example). My only quibble with the book is that the topic is so common sense that there shouldn’t need to be a full length volume describing this, yet here we are in 2020 and this is not a convincing argument to many in the US.
In engineering management graduate work (not exactly a bastion of progressive thought), one comes across numerous DARPA related projects that are viewed as great successes. Yet conservatives will scream to the hilt about examples like Solyndra (which Mazzucato addresses fully) that show that the Govt can’t invest correctly, essentially saying that the Govt must bat 100% with every investment dollar, while private equity has a success rate that often falls short (also conservatives have no problem with privatizing gains but socializing losses when the values are high enough – see the ’08 crash and the current Covid bailouts as examples). Mazzucato argues how Govt is best positioned for a number of important areas for funding – areas that private industry views as too risky to take on and where scale is needed (fusion research as a quintessential example). My only quibble with the book is that the topic is so common sense that there shouldn’t need to be a full length volume describing this, yet here we are in 2020 and this is not a convincing argument to many in the US.
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