Economies of scale mean that the largest firms are also the most efficient, at least when measured by profit. But do we want an economy that is largely one of monopolies?
...it is theoretically possible to build a society where every industry is highly competitive, full of thousands of firms that ruthlessly compete against each other, but with all of those thousands of firms being owned by the government.
Isn't that a bit how the various branches of the military and other government programs (thinking specifically of NASA) work now? In that they are all competing against each other for tax dollar allocations and theoretically have to justify their budgets to the public via our representatives in Congress. In a system that was working properly the various government departments would justify their budgets to the public with both innovation and efficiency, and the public - through their elected Congressional representatives - would allocate more money to the branches and departments that had adequately justified their benefit to society. Theoretically. Of course, what actually happens in our dysfunctional system is that our Congressional representatives are more focused on either giving money to departments based in their home districts (pork-barrel spending) or making sure the private businesses that gave the most money to their campaigns are getting the most benefit of government spending rather than the public. Campaign finance changes would go a long way to fixing that particular problem with our democracy.
I agree, that is how parts of the government already work. The best example is probably DARPA, which hands out grants to promising technologies, and then if a technology seems to be promising, DARPA puts in even more money. It's like an investment fund for stuff that is too early stage to be funded by mainstream commercial investment. ARPA/DARPA funded the development of numerous computer network protocols in the 1960s and 1970s, but then the TCP/IP protocol emerged as the most successful, so DARPA gave it more funding. The "IP" is literally "Internet Protocol" so this is what became what we now call the Internet. It was opened up to commercial investment in 1993, but from 1963 to 1992 it was nurtured by the government. (The Internet starts with the Licklider memo of April 25th, 1963.)
I think that kind of grant writing is a good example of the kind of investment that the government could do.
Regarding this:
...it is theoretically possible to build a society where every industry is highly competitive, full of thousands of firms that ruthlessly compete against each other, but with all of those thousands of firms being owned by the government.
Isn't that a bit how the various branches of the military and other government programs (thinking specifically of NASA) work now? In that they are all competing against each other for tax dollar allocations and theoretically have to justify their budgets to the public via our representatives in Congress. In a system that was working properly the various government departments would justify their budgets to the public with both innovation and efficiency, and the public - through their elected Congressional representatives - would allocate more money to the branches and departments that had adequately justified their benefit to society. Theoretically. Of course, what actually happens in our dysfunctional system is that our Congressional representatives are more focused on either giving money to departments based in their home districts (pork-barrel spending) or making sure the private businesses that gave the most money to their campaigns are getting the most benefit of government spending rather than the public. Campaign finance changes would go a long way to fixing that particular problem with our democracy.
I agree, that is how parts of the government already work. The best example is probably DARPA, which hands out grants to promising technologies, and then if a technology seems to be promising, DARPA puts in even more money. It's like an investment fund for stuff that is too early stage to be funded by mainstream commercial investment. ARPA/DARPA funded the development of numerous computer network protocols in the 1960s and 1970s, but then the TCP/IP protocol emerged as the most successful, so DARPA gave it more funding. The "IP" is literally "Internet Protocol" so this is what became what we now call the Internet. It was opened up to commercial investment in 1993, but from 1963 to 1992 it was nurtured by the government. (The Internet starts with the Licklider memo of April 25th, 1963.)
I think that kind of grant writing is a good example of the kind of investment that the government could do.