2 Ha-Joon Chang and Antonio Andreoni, “Industrial Policy in the 21st Century,” Development and Change 51, no. 2 (2020): 324–51.
3 Much has been made of China’s ambitious “Made in China 2025” plan, which aims to propel the Middle Kingdom from technological follower to innovation leader. Yet China is far from the only nation to put forward bold industrial policy. In France, President Macron recently outlined “France 2030,” a five-year, €30 billion investment plan to boost the country’s high-tech industries and reduce dependence on imported raw materials and electronic components. In 2019, Germany released the “National Industrial Strategy 2030” that seeks to ensure the long-term competitiveness of its national champions and support the development of digitization, artificial intelligence, and battery cell manufacturing. In Brussels, EU institutions such as the European Investment Bank (EIB) and the European Investment Fund (EIF) have joined forces with European governments, universities, private investors, industry, and labor in the creation of industrial alliances around the development of electric battery production, semiconductor technologies, and cloud computing.
4 David E. Sanger et al., “Senate Poised to Pass Huge Industrial Policy Bill to Counter China,” New York Times, June 7, 2021.
5 Mariana Mazzucato, “The Entrepreneurial State: Socializing Both Risks and Rewards,” Real-World Economics Review 84 (June 21, 2018): 201–17.
6 Dan Breznitz, Innovation in Real Places: Strategies for Prosperity in an Unforgiving World (New York: Oxford University Press, 2021); Erez Maggor, “Politics of Innovation: The Entrepreneurial State and the Making of Israel’s ‘Start-up Nation,’” PhD diss. (New York University, 2020).
7 William B. Bonvillian and Peter L, Singer, Advanced Manufacturing: The New American Innovation Policies (Cambridge: MIT Press, 2018).
8 Adi Robertson and Russel Brandom, “Congress Releases Blockbuster Tech Antitrust Report,” Verge, October 6, 2020.
9 Bonvillian and Singer, Advanced Manufacturing; Suzanne Berger, Making in America: From Innovation to Market (Cambridge: MIT Press, 2013).
10 Here, I draw mainly on my dissertation research: Maggor, “Politics of Innovation.” See also: Erez Maggor, “The Politics of Innovation Policy: Building Israel’s ‘Neo-Developmental’ State,” Politics & Society 49, no. 4 (2021): 451–87.
11 The fact that repayments were conditioned upon successful sales lowered the risk associated with the investment, thereby significantly lowering barriers to entry. Also, because OCS royalties were recycled back to industry in the form of new R&D grants, this mechanism increased the fiscal capacity of OCS without requiring additional budget appropriations.
12 In March 2014, Given Imaging was acquired by the Irish multinational Covidien and became a private company. This occurred only after the R&D Law was reformed in 2005, softening regulations banning the transfer of IP, as discussed herein.
13 Dan Breznitz, “Industrial R&D as a National Policy: Horizontal Technology Policies and Industry-State Co-Evolution in the Growth of the Israeli Software Industry,” Research Policy 36, no. 9 (2007): 1465–82.
14 “Israel Innovation Authority’s 2021 Innovation Report,” Israel Innovation Authority.
15 “OECD Economic Surveys, Israel,” March 2018.
16 Moshe Justman and Ehud Zuscovitch, “The Economic Impact of Subsidized Industrial R&D in Israel,” R&D Management 32, no. 3 (2002): 191–99; Manuel Trajtenberg,“Innovation in Israel 1968–1997: A Comparative Analysis Using Patent Data,” Research Policy 30, no. 3 (2001): 363–89.
17 Richard Doner and Ben Ross Schneider, “The Middle-Income Trap: More Politics Than Economics,” World Politics 68 no. 4 (2016): 608–44.
18 For South Korea, see: Vivek Chibber, Locked in Place: State-Building and Late Industrialization in India (Princeton: Princeton University Press, 2003). For Japan, see: Chalmers Johnson, MITI and the Japanese Miracle: The Growth of Industrial Policy: 1925–1975 (Stanford: Stanford University Press, 1982). For France, see: John Zysman, Governments, Markets, and Growth: Financial Systems and the Politics of Industrial Change (Ithaca: Cornell University Press, 1984).
19 Matthew Kalman, “Israel’s ‘Startup Nation’ Is under Threat from the Tech Giants That Nurtured It,” MIT Technology Review, January 8, 2019.
20 Anat Levi and Roy Goldschmidt, “Analysis of the Office of the Chief Scientist Budget,” Knesset Research and Information Center, May 2013.
21 Kalman, MIT Technology Review.
22 Dan Breznitz, “What Silicon Valley Gets Wrong about Innovation,” Boston Review, October 21, 2021.
23 Lola Duffort, “Sanders Pitches ‘Strings’ to $50 billion Semiconductor Subsidies,” VTDigger, May 25, 2021.
24 Tony Room, “Senate Approves Sprawling $250 Billion Bill to Curtail China’s Economic and Military Ambitions,” Washington Post, June 8, 2021.
25 Thomas Ferguson, “From Normalcy to New Deal: Industrial Structure, Party Competition, and American Public Policy in the Great Depression,” International Organization 38, no. 1 (1984): 41–94.
26 Robert H. Wade, “The Mystery of US Industrial Policy: The Developmental State in Disguise,” Transforming Economies: Making Industrial Policies Work for Growth, Jobs and Development, eds. José M. Salazar-Xirinachs, Irmgard Nübler, and Richard Kozul-Wright (Geneva: International Labour Organization, 2014), 379–400.
27 Linda Weiss, America Inc.?: Innovation and Enterprise in the National Security State (Ithaca: Cornell University Press, 2014).