This report explains why Scotland needs a recovery plan based on growth and innovation.

Key findings:

• Government policy should focus on supporting innovative sectors that have the potential for strong growth once the recovery begins.
• Three areas for potential growth are especially promising: the green economy; creative industries; and healthcare. 
• Success in these areas requires the government to support businesses through a combination of: infrastructure development, regulation that actively encourages growth, and the use of government procurement to stimulate demand.

The challenge facing the UK economy is now to find new sources of growth that will drive prosperity over the coming years. 

Traditional intervention policies have sought to prop up old industries, but recovery from the recession will require a new approach from government.

The Scottish Government has identified long-term goals for Scotland's economy and society. These include boosting Scotland's growth, productivity, population and participation. However this research argues that traditional 'industrial policy' of bailing out industries is not the best way to achieve this goal.

Authors:

James Meadway with Juan Mateos-Garcia