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Increasingly, policymakers are focused on entrepreneurial innovation as a key to unlocking higher levels of economic growth. With the economy still functioning at a sub-par level and the unemployment rate a stagnant 9 percent, many people believe that only heightened entrepreneurial activity can get America moving again. President Obama shares this viewpoint, and legislative bodies at all levels have been intensifying their focus on this policy. However, what is the role of government in nurturing innovative products, services, and business ideas? Is government, through its banking and regulatory roles, the guiding hand that leads entrepreneurs toward socially and economically beneficial innovation? Or does government best support the growth of innovation by providing a non-intrusive institutional environment within which entrepreneurs create new things? In what ways can the government foster innovation, and in what ways is government a hindrance?

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