The influence of government policies on innovation and technological advance

Governments have always attempted to influence the behaviors of their citizens. Modern governments have focused on influencing private sector innovation and technological advance as a means to increase national wealth and international competitiveness. The notion of government policies that stimulate a cycle of ever-increasing technological advantages, national wealth and a high quality of life for its citizens is theoretically appealing. But questions remain about the effectiveness of such policies, even after many decades of historical records. This article presents a conceptual model of government policies for stimulating national technological advances and examines the consequences of those policies. The results indicate that government policies can foster technological advances, but they can also have unintended effects that retard the economic growth of nations. To ensure that the intended effects will indeed result, government policy makers must evaluate thoroughly and test carefully all policies prior to implementing them.