Mission-oriented Public Organizations for Knowledge Creation

The purpose of this paper is to investigate and discuss the role played by the state in enhancing technological progress, creating knowledge and fostering radical innovation. This catalyst function may take place in different ways. Specifically, we focus on three channels: (a) R&D of traditional state-owned or state-invested enterprises; (b) funding of organizations such as public agencies, research universities and large research infrastructures (e.g. CERN, NASA, etc.); (c) indirect intervention through public procurement for innovation. We critically review existing contributions, summarize their main findings and discuss the benefits and costs entailed by these policies. We claim that research, development, and innovation should be supported by governments not simply to pursue generic growth objectives but also to meet societal challenges like energy transition, sustainable mobility, the digital society, the demographic transition and climate change. Mission-oriented organizations can be powerful tools for achieving the technological breakthroughs needed to tackle these challenges.