Building the Venture Capital State

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In a 1986 speech, then president Ronald Reagan lamented that “the nine most terrifying words in the English language are: I’m from the government and I’m here to help.” This statement epitomizes the neoliberal view of how Silicon Valley became a global beacon of high-technology ingenuity, entrepreneurship, and venture capital. For followers of Ronald Reagan and Milton Friedman—not to mention staunch libertarians and “tech bros” in the Bay Area today—Silicon Valley is the triumph of the free market and American capitalism. There is another version of the story, however, that offers important lessons both for American policymakers looking to promote economic growth in other regions and for foreign policymakers seeking to recreate the “magic” of Silicon Valley in their own countries. In the true story, the visible hand of the state is evident behind the veneer of the supposedly laissez-faire Silicon Valley venture capital (VC) market.
Original languageEnglish
JournalAmerican Affairs
Issue number3
Publication statusPublished - 20 Aug 2018


  • venture capital
  • united states
  • Silicon Valley


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