An Assessment of Government Innovation Policies

The authors compare the innovation policies of industrialized countries along several dimensions: the policy tools (e.g., supply, demand, environment) they use or prefer, and their national philosophies, especially whether they have explicit policies toward the development of specific industries or technologies. They also identify the principal difficulties that existing innovation policies have suffered. Among them are the lack of market know‐how among policymakers, bias toward research and development‐oriented stimuli rather than other aspects of innovation such as demand, and vulnerability of policies to changes in political philosophy. They conclude with a list of questions that governments initiating policies of technological choice should consider to avoid some of these pitfalls.