How can policy stimulate innovation? This course provides students with theoretical and practical insights into why and when policy measures are necessary, how they can be pursued, and how they relate to innovation processes. We further build on the microeconomic theory from 0SV30 to emphasize policy interventions, in contrast to a pure market process, and introduce the concept of market failure. Furthermore, we discuss the impact of economic interventions and regulations on the market. Important concepts in the course are economic rationality and social welfare, the theory of perfect competition, market failure, regulation and competition policy.