Innovation leads to growth
In modern economies, growth is needed to increase the quality of life of people. Plus, there is a financial requirement for growth. innovation led policies are the response of states to ensure increasing levels of growth.
Growth can be fueled by natural resources expansion (discovering a new oil field, expanding the number of harvested hectares, etc.) or by increased efficiencies in the production.
Expanding natural resource exploitation may require infrastructure, it may require new technologies (new pesticides, new extraction techniques).
Increasing efficiencies in production normally come associated with some form of technological innovation. A new industrial process, a new material. It can also be that efficiency gains come from external technologies, such as using wireless technologies for remote monitoring.
A question I have is whether high value ideas are based on research and science. I think it depends on the level of industrialization of the economy being considered.
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