Innovation Policy: What, Why & How

During the last two-three decades policy-makers have increasingly became concerned about the role of innovation for economic performance and, more recently, for the solution of challenges that arise (such as the climate challenge). The view that policy may have a role in supporting for innovation has become widespread, and the term innovation policy has become commonly used. This paper takes stock of this rapidly growing area of public policy, with particular focus on the definition of innovation policy (what it is); theoretical rationales (why innovation policy is needed); and how innovation policy is designed, implemented and governed.