Mission Impossible: Why the Mission-Oriented Economy is Bad Policy

Recent studies have argued that governments should play a more active role in driving innovation by undertaking high-risk, mission-oriented investments. In this framework, governments should shape markets instead of fixing them. The mission-oriented economy highlights state-led technological breakthroughs, yet it overlooks the informational role of market discipline. Insulated from profit-and-loss feedback, government-led missions will supplant entrepreneurial successes with engineering ones. This raises broader concerns about equating risk-taking with entrepreneurship and replacing decentralized discovery with centralized direction. This article examines these tensions and outlines a framework for understanding how markets and states contribute differently to innovation.