Economic innovation plays a major role in producing sustainable economic prosperity and enhancing the global competitiveness of places around the world. The propensity to conceive and develop new products, technologies, processes, business models, and markets results in goods and services that are faster, cheaper, and better. Transforming new ideas into concrete, tangible realities has long been a part of the U.S. mindset. Over the last two centuries, Americans have experienced a 20-fold increase in living standards. While this is due in part to increased accumulation and better allocation of capital, it is also due to the commercialization of new forms of production, products, business models, and in the creation of new markets and how they are served. These advances are clearly generated by the private sector, but are also supported through public policy.

Since innovation is generated by the private sector, the role of the public sector is to find ways to help spur innovation by supporting ideas, institutions, and relationships, according to GO TO 2040.  The White House’s Startup America Initiative is a good example of the public sector working to support innovation in the private sector.  One of the main goals of the Initiative is to increase the number of new high-growth firms that are generating quality jobs while creating economic growth and innovation.  On March 29, 2011, Secretary Chu of the U.S. Department of Energy (DOE) announced the “America’s Next Top Energy Innovator” challenge, which is designed to “give start-up companies the opportunity to license groundbreaking technologies developed by the national laboratories for $1,000 and build successful businesses.”  Currently, only 10 percent of federal patents have been licensed to be commercialized.  Through this challenge, DOE will reduce both paperwork and cost requirements for start-up companies to gain an option agreement to license the thousands of patents and patent applications held by the national laboratories in hopes to double the number of startups coming out of the laboratories.  The challenge kicks off May 2 and submissions will be accepted through December 15, 2011.