The Economics of Incomplete Plan -on Conditions, Procedures and Design of Future Mission- Oriented Innovation Policies

Abstract

The buzzword in industrial policy and innovation policy circles is mission-oriented innovation policy (MOIP) –which means a policy to encourage innovation intended to accomplish a certain mission– whether it be a societal challenge (climate change, global health) or an industrial policy issue (sectoral transition or modernisation, establishment of a new industry). This new category results from what seems a priori to be just a simple qualifying extension of mission-oriented policies (MOPs) –very much in vogue in the 70’s and 80’s and used particularly in sectors like space and defence. However, this ‘simple’ qualifying extension does in fact cause a significant discontinuity that merits reflection. While a mission imposes a discipline and centralised priorities and decisions, innovation on the other hand can’t be planned. Innovation is so uncertain that no plan will ever enable it to be tamed. There is thus a tension between mission and innovation, between a planning logic and a freedom to experiment logic. This tension implies thus advancing our knowledge about MOIP design, which is the goal of this paper.