A new report authored by Professor Mariana Mazzucato and Laurie Macfarlane outlines a new ‘mission-oriented’ strategy to revitalise Scotland’s economy, transition to net zero and tackle inequalities.

 

The report, published jointly by the UCL Institute for Innovation and Public Purpose (IIPP) and Future Economy Scotland, warns that Scotland “can’t afford to sit on the sidelines” as other countries use industrial policies to reshape their economies for a new age. Scotland must “act boldly to shape the economy, or it will be shaped by global market forces beyond its control”, the authors warn.

While the Scottish Government’s Green Industrial Strategy, published in September 2024, is welcomed as a “vital first step”, the report finds that bolder action is needed to “rethink the role of the state for the 21st century”. Efforts to lure inward investment cannot be relied on to deliver the necessary transformation, the authors warn – with investment in Scotland still among the lowest among advanced economies. Instead, policy must aim to “awaken the animal spirits among domestic firms”, with the state acting boldly to co-create and co-shape the industries and markets of the future.

To achieve this, the report calls on the Scottish Government to embrace a ‘mission-oriented’ approach to industrial strategy – coordinating all available tools, institutions and capabilities to drive “system-wide transformation”. Rather than handing out support to selected sectors, the Scottish Government should embrace “a whole-of-government approach” to align social and environmental priorities with economic goals. The time has come for Scotland to move beyond bold rhetoric and start “matching ambitious words with meaningful action”, the authors warn.

The report sets out more than 13 recommendations across six thematic areas, including:

Commenting on the report, Professor Mariana Mazzucato, who served on the Scottish Government’s Council of Economic Advisors between 2015 and 2022, said:

“Governments worldwide have recognised the need for a more proactive state to address the grand challenges of the 21st century. But while Scotland is talking the talk on industrial strategy, it has yet to walk the walk. Our report outlines how a mission-oriented approach can catalyse cross-sectoral investment around bold goals, learning from best practice around the world. By embracing a mission-oriented approach, the Scottish Government can achieve the ‘fair, green and growing economy’ it has promised – but has yet to deliver.”

Laurie Macfarlane, Co-Director at Future Economy Scotland and IIPP Policy Fellow, said:

“Too often the Scottish Government publishes well-meaning strategies but then fails to deliver meaningful change. It is not enough to simply talk the language of transformative change while making small tweaks to a broken system. The time has come to match ambitious words with meaningful action. Our report shows how the Scottish Government can fully harness devolved tools, institutions and resources to drive the structural change Scotland so desperately needs.”

 

-ENDS-

 

NOTES TO EDITORS

 

[1] This story was first published by The Times Scotland as an exclusive on 3 September 2025.

 

[2] In September 2024 the Scottish Government published its first ever Green Industrial Strategy. The report from UCL IIPP and Future Economy Scotland is independent research, and is not formally connected to the Scottish Government’s own work on industrial strategy.

 

[3] Professor Mazzucato served on the Scottish Government’s Council of Economic Advisors between 2015 and 2022. She is no longer advising the Scottish Government in any formal capacity.

 

[4] The Institute for Innovation and Public Purpose (IIPP) at University College London (UCL) aims to develop a new framework for creating, nurturing and evaluating public value in order to achieve economic growth that is more innovation-led, inclusive and sustainable. IIPP is housed in The Bartlett, a leading global Faculty of the Built Environment at University College London (UCL), with its radical thinking about space, design and sustainability.

 

[5] Future Economy Scotland is a non-partisan think tank that aims to create a new economy that is democratic, sustainable and just. The organisation does not have a formal stance on Scotland’s constitutional future, and is not aligned to any political party or any politician. The organisation is a not-for-profit company limited by guarantee operating with charitable principles.

 

[6] For any questions or press enquiries, please contact laurie@futureeconomy.scot or call 07909107890