demand-side policies
Policies that include: Business Assistance, International Trade, Technology Transfer, Entrepreneurial Development, and Special Industry reflect support for new and/or risky enterprises and ideas and public-private strategic collaboration… According to the demand-oriented theory that motivates the entrepreneurial state, however, demand for new products may be stimulated by factors other than by price reductions. Growth is not only a function of input costs, but is fueled by identifying and meeting demand in external markets that may have different price elasticities. The role of economic development policy under this set of assumptions is to help businesses identify, meet, and even shape external demand; in doing so, public officials necessarily become partners with private firms in establishing production priorities and strategic decisions. Supporting innovation and entrepreneurship is, in turn, central to demand-side development policy because local advantages are found in anticipating new areas of external demand and moving quickly to become early suppliers. Demand-side policies are, therefore, distinguished not by the particular industries they target but by interventions tied to a particular stage in the product cycle. Finally, there is an element of risk management implicit in the relationship between state and private actors under the demand-side approach: When firms become risk adverse or otherwise distracted from pursuing new products and new markets, the entrepreneurial state acts to redirect firms’ priorities and/or share the risks associated with investing in new products and new markets… Demand-side policies provide support for new and/or risky enterprises and ideas early in the product cycle (entrepreneurs and innovation) and rely on public–private strategic collaboration. (Hanley, 2014)