I will focus on one important component of innovation policy: government support for R&D. The economic arguments for government support of innovation generally imply that governments should focus particularly on fostering basic, or foundational, research. Economic policy affects innovation and long-run economic growth in many ways. Indeed, some economists have argued that because of the potentially high social return to basic research, expanded government support for R&D could, over time, significantly boost economic growth. This research suggests that technological progress and the accumulation of intangible capital have together accounted for well over half of the increase in output per hour in the United States during the past several decades. Similarly, I don't give too much thought to the multitude of provisions for sharing revenues from foreign translations, from selling the rights to produce my books as stage plays and movies (yep, those provisions are in the contracts), etc. There are other things I care about more than those things, so I leave my editor alone on those topics and save my political capital for other matters. Certainly there have been disappointments; for example, the surge in federal investment in energy technology research in the 1970s, a response to the energy crisis of that decade, achieved less than its initiators hoped.
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