Most venture capital funds are too short-termist and exit-driven to deal with the highly uncertain and lengthy innovation process.

Mainstream economic theories popular in the last several decades have tended to downplay the government's role in markets and to increase skepticism about even that more limited role. Austerity, particularly in Europe, has added to the problem. It has not worked, even on its own terms.

If we look at Germany's infrastructure policy, it has been driven by its mission-oriented focus on green infrastructure. This affects both innovation and infrastructure, old industries and new. The German steel industry, for example, has adapted to the policy by lowering its material content through a 'repurpose, reuse and recycle' strategy.

We should be investing where the public returns are greatest - that is in innovation.

If we look at the complexity of the challenges facing western societies today, we see that the problems are not really about outsiders, but have their roots much closer to home.

Fixing markets isn't enough. We have to actively shape and create them and tilt the playing field in the direction of the growth we want.

Real median household incomes in the U.S. were basically the same in 1989 as in 2014. But we are also seeing similar challenges in the U.K. in the stagnation of real wages.