IN THEIR WELL-EXECUTED ARGUMENT for a new approach to economic policy, Mazzucato, Kattel, and Ryan-Collins spell out how governments could develop an industrial policy to shape and drive innovative opportunities for the future. They rightly demolish the folk tales of neoliberalism: the elevation of markets to mythical status, the reverence for allegedly “independent” central bankers, the skepticism of government action, and the deregulation of trade and foreign direct investment.
I deliberately use the word “could,” however, because a lot hangs on future conditions. While the authors offer both practical and effective strategies for tackling grand challenges, they offer only part of the solution. There are two major gaps in their account that suggest another approach may be needed.