Marianna Mazzucato’s 2013 book, The Entrepreneurial State, has provoked widespread debate about the role of government in innovation, supporting the view that the state should be entrepreneurial by participating in the upside of its innovation funding. But beyond examples and narratives, do her arguments survive a rigorous empirical test and stack up as a guide to policy? In a recent paper, we investigate the impact of state ownership on the innovativeness of firms, as measured by the number, quality, and value of the patents produced. In a sample of listed European firms, we find that minority government ownership increases investment in research and development, especially for financially constrained firms and during “normal” macroeconomic conditions. Yet, government control leads to the opposite effect, by imposing myopic goals and complicating access to private equity markets. Overall, state owned enterprises (SOEs) produce fewer patents per dollar invested and about 10% fewer patents in absolute terms. When comparing SOE patents to private-sector patents, we find no difference in patent quality as measured by the number of citations received per patent or by the market reaction at patent publication. Furthermore, we find no increase in the number of patents focused on sustainable technologies, suggesting that SOEs do not emphasize innovation that produces public goods or social spillovers.