Public Investment and Inclusive Growth

Mariana Mazzucato in conversation with Christian Kern

Moderation: Katerina Vrtikapa and Steffen Bettin (Gesellschaft Plurale Ökonomik)

Hosted by Gesellschaft Plurale Ökonomik, Bruno Kreisky Forum for International Dialogue and VW-Zentrum.

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The financial and economic crisis has revealed the limits of the austerity doctrine in delivering sustainable growth and full employment. This might now be seen as a U-turn for orthodox economists who had provided the theoretical underpinnings for laissez-faire policies, but not for progressive thinkers. Mariana Mazzucato has played an important part in uncovering the importance of government action for investment and long-term growth. Her research on innovation and innovation-led growth provides an empirical and theoretical basis to understand the state’s role in creating wealth, not only distributing it.

Mazzucato provides an alternative approach, focusing on the underappreciated role of state financed R&D to show how strategic public investment can lead to increases in private investment. This she argues is not enough: we also need new kinds of deals between public and private sectors that involve sharing not only the risks but also the rewards—leading to smart growth that is also inclusive growth.

Christian Kern will elaborate on how Mariana’s ideas have influenced his political agenda and how they can be implemented in Austria.

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