Mariana Mazzucato Thinks We Need More Moonshots

What It Covers

Mariana Mazzucato, economist and UCL professor, argues that effective government requires mission-oriented thinking — defining concrete societal goals like healthy school lunches or fossil-free welfare states — rather than sector-based subsidies, while rebuilding internal state capabilities hollowed out by decades of outsourcing to management consultants.

Key Questions Answered

• •Mission vs. Sector Policy: Stop directing industrial policy at specific sectors or firm types like SMEs. Instead, define concrete, ambitious missions — such as healthy, tasty, sustainable school lunches — that require cross-sector collaboration. This forces agriculture, health, education, and finance ministries to coordinate, generating innovation across multiple industries simultaneously rather than rewarding incumbents for existing.
• •State Capacity Framework: Distinguish three layers of government effectiveness: capacity (budget, headcount), administrative routines (stable processes enabling learning-by-doing), and dynamic capabilities (agility, cross-department coordination, smart partnership design). Most governments have the first two but systematically lack the third, which is the layer that actually determines whether public investment produces outcomes or waste.
• •Procurement as Innovation Tool: NASA's Apollo program succeeded partly by shifting from cost-plus procurement to outcomes-oriented procurement — defining problems like astronaut nutrition, communication, and waste management without prescribing solutions. This model generated camera phones, foil blankets, and home insulation. Governments controlling roughly 30% of GDP through procurement can replicate this problem-first contracting approach today.
• •Consultancy Trap: Governments that outsource core functions to firms like McKinsey or Deloitte create structural conflicts of interest — consultants have no incentive to build lasting government capability since that eliminates future contracts. The fix is reinvesting internally first, then using external advisers only for genuinely one-time tasks, while embedding knowledge-transfer requirements directly into contract terms.
• •AI Talent Hemorrhage: The most underappreciated AI governance risk is the mass migration of publicly trained researchers from universities, DARPA, and national labs into private AI companies offering multiples of academic salaries. Once technical expertise concentrates inside a handful of firms, governments lose the internal understanding needed to write meaningful regulations, design useful disclosures, or direct AI toward public health and climate problems.