THE PRIORITY DIRECTION OF ECONOMIC DEVELOPMENT IN THE SPHERE OF INNOVATION THE FACTOR OF PUBLIC-PRIVATE SECTOR COOPERATION

Abstract

Such a vital trend for the economic development of innovation, as the above-defined cooperation between the public and the private sectors, mere fact becomes possible only due to such a symbiosis. The symbiosis of two fundamentally oppositional structures creates a context in which a unique ecosystem, propelling innovation and economic improvement, can be facilitated. On the one hand, the public sector brings an incredible insight into regulation capacities and significant funding utilities.  The issue that arises in this partnership is a market failure when none of the sectors can encourage technological development on their own. A partnership, however, does help to establish innovation hubs, encourage research and development, and facilitate commercialization. Governments through adjusting public policies to the private sector and indulging in joint ventures overcome market failure and stimulate innovation. Such partnerships also beneficial in addressing societal problems via innovation, thus, at the long-run level, private and public unions become a necessity.