Name: The Entrepreneurial State
Rating: 3.7 (23 reviews)
Author: Mariana Mazzucato

What’s in it for me? Learn why we need an entrepreneurial state.

Never before have we faced such daunting global challenges. Climate change alone will require international cooperation and political ingenuity on a scale we have not seen before. It will also require innovation. Lots of innovation. But who should be doing the innovating? And what should the state’s role be in all this? To leave it to corporations and the market to sort out? Or to take a more active role?

As these blinks will show you, there has never been, nor should there be, a clear-cut line between the state and entrepreneurship. They go together like the proverbial peanut butter and jelly.

In these blinks you’ll learn

who really invented Google’s search algorithm;
why we can’t leave it to corporations to develop green technology; and
what Apple owes the American taxpayers.

Believe it or not, the state has proven itself to be a savvy investor.

It seems like market leaders Google, Facebook and Apple announce stunning new innovations every week. It’s hard not to be impressed by these top-performing companies. But should we really give them all the credit?

Believe it or not, those companies and even technology itself wouldn’t be where they are today without the help of one key player: the state.

Take Google, for example. For the past decade, Google has been one of the most influential companies on earth. It’s an innovative force that controls the way we use the internet. Google’s domination began with one innovation in particular: its search algorithm, an invention that Google alone was responsible for . . . right?

Wrong! The research and development for Google’s winning algorithm was made possible through state funding. The private sector didn’t have a hand in it – investors were simply too scared to back Google’s revolutionary project.

This isn’t the only case where the public sector has displayed remarkable foresight. And yet, why are public opinion and even economists so strongly against public sector involvement in the market?

The truth is that history has been warped. While the achievements of the state have been celebrated as the victories of an innovative and daring private sector, the failures of the private sector are portrayed as fatal mistakes made by the state.

Take the financial crisis of 2007, for example. Most of us would blame that devastating market collapse on overwhelming public sector debts. In 2011, British Prime Minister David Cameron even vowed to give the private sector more freedom to combat the ill-advised government investments and convoluted bureaucracy that seemed to be the root of the crisis.

And yet, we should know by now that the greatest contributor to the crisis was in fact the private sector. Companies desperately trying to increase their profit, most notably in the US real estate market, spiraled out of control. This created a massive financial bubble, which caused the crisis.

With this in mind, it’s about time we reconsidered the role of the state in business.

The entrepreneurial state is a risk-taking, pioneering investor.

Nobody ever found success without taking some risks. If we want our economy to succeed, we can’t just play it safe. Without taking the plunge and investing in innovative and unknown technologies, we’ll never see the progress we dream of. So who should take on these risks?

Many young and bright companies turn to venture capital for funding and support. But is this the right way to go? Sure, venture capitalists are more than happy to pump money into projects that seem profitable, but when it comes to groundbreaking innovation and research, venture capitalists are just too scared of taking a hit.

Entrepreneurial states will play a crucial role in advancing green technology.

Global warming is real, and has already begun to have radical impacts on our planet. Although fossil fuels are running out and the Earth’s climate grows more volatile, our technologically advanced world demands more energy than ever. In other words, we’ve got a huge problem on our hands.

Green technology is our only hope for fulfilling growing global energy needs and keeping climate change in check. By converting solar, wind and water power into electricity, we need no longer rely on finite resources such as coal and fossil fuels that damage our environment.

Citizens and the economy should reap the benefits of state-funded successes.

We’ve learned that the iPhone as we know it today wouldn’t be here without state-funded technologies. If you think Apple doesn’t give the state credit for this, you’d be right.

The problem with Apple is that, although it makes huge profits, it doesn’t give back much to the American economy. Many companies are granted funding under the assumption that they will then go on to create new, well-paying jobs and offer workers skill-development opportunities.

Key ideas in The Entrepreneurial State

What is The Entrepreneurial State about?

The Entrepreneurial State (2014) sheds light on the state’s role as a daring investor in emerging technology. From the iPhone to sustainable energy, these blinks reveal the central role governments have played in creating the world we know today, and how they can help to secure our planet’s future.