It is argued that high-tech industries typically generate new technologies but cannot fully appropriate the commercial benefits associated with their inventions or discoveries. If this is TRUE, then in order to maximize a country's real income, the government should

Question

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By subsidizing high-tech firms, the government can help overcome the problem of underinvestment in research and development that arises from the failure of the firms to appropriate the full benefits of their innovations. This can encourage more technological progress and ultimately lead to higher real income for the country. Taxing the firms or discouraging their investments would have the opposite effect, while protecting or outsourcing their production would not address the root problem of inadequate incentives for innovation.

It Is Argued That High-Tech Industries Typically Generate New Technologies