Should Governments Produce Wealth? Governments should not try to produce wealth, I think. But they should maintain the conditions under which wealth can be produced. They often do this.

Perhaps governments should support research until we invent institutions that compensate the enterprises that support research with low transaction costs. We must allow learning that requires knowledge of results of research. What a student learns in science is mostly the results of research.

The patent system is a high transaction cost system. It is far more common to hear of designing around a patent, than licensing it.