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Policies supporting technological innovation rely on a wide variety of instruments, such as patents, subsidies, public procurement, tax breaks and public research. The purpose of this article is to examine these instruments in the light of economic theory. The condition traditionally attached to government intervention in this area, that social return on research be higher than private return, is now seen as not sufficient. Due to incomplete and asymmetrical information, the government may mis-target its intervention or give rise to incentive structures leading agents to behave in a way that contradicts the policy goals. The relative efficiency of the various policy instruments depends notably upon the information structure of each case.