Public management, policy capacity, innovation and development

Vol. 34 No. 1 (2014)

Jan-Mar / 2014
Published January 1, 2014
PDF-English
PDF-English

How to Cite

Karo, Erkki, and Rainer Kattel. 2014. “Public Management, Policy Capacity, Innovation and Development”. Brazilian Journal of Political Economy 34 (1):80-102. https://centrodeeconomiapolitica.org.br/repojs/index.php/journal/article/view/262.

Public management, policy capacity, innovation and development

Erkki Karo
Research Fellow at Ragnar Nurkse School of Innovation and Governance, Tallinn University of Technology (Estonia).
Rainer Kattel
Professor at Ragnar Nurkse School of Innovation and Governance, Tallinn University of Technology (Estonia).
Brazilian Journal of Political Economy, Vol. 34 No. 1 (2014), Jan-Mar / 2014, Pages 80-102

Abstract

In this paper we discuss the question of what factors in development policy create specific forms of policy capacity and under what circumstances development-oriented complementarities or mismatches between the public and private sectors emerge. We argue that specific forms of policy capacity emerge from three interlinked policy choices, each fundamentally evolutionary in nature: policy choices on understanding the nature and sources of technical change and innovation; on the ways of financing economic growth, in particular technical change; and on the nature of public management to deliver and implement both previous sets of policy choices. Thus, policy capacity is not so much a continuum of abilities (from less to more), but rather a variety of modes of making policy that originate from co-evolutionary processes in capitalist development. To illustrate, we briefly reflect upon how the East Asian developmental states of the 1960s-1980s and Eastern European transition policies since the 1990s led to almost opposite institutional systems for financing, designing and managing development strategies, and how this led, through co-evolutionary processes, to different forms of policy capacity. 

JEL Classification: O25; P110: P160; P520.


Keywords: innovation economic development economic planning political economy transition economies