## 2 Literature Review
### Development of the National-Commercial Interplay
Government investment or prioritizing decisions in this pathway are typically guided by strategic national interests, especially in domains where market incentives are weak or where technologies remain in nascent or high-risk stages. As such, innovation is tightly linked to national security goals, aligning with state interests and advancing national capabilities, limiting undesired proliferation. This pathway emphasizes strategic and political leadership and competition. Under this pathway, adaptation to broader economic and technological shifts is expected to be slow and limited. The 1962 cartoon, in which American and Soviet leaders wrestle while sitting atop H-bombs, is a good artistic reflection of the tech-rivalry dynamic under a national-to-commercial pathway over S-technologies. In contrast, the second pathway, which we refer to as **Commercial-to-National**, exemplifies a more open and market-driven innovation model shaped by ecosystem dynamics and public-private interdependence. Here, governance is more decentralized and collaborative, relying on partnerships that allow private entities to lead innovation efforts. Governments serve as enablers--creating favorable regulatory conditions, offering investment incentives, and acting as anchor customers or venture partners. The ownership of technological assets primarily resides in the hands of private actors, although the benefits often spill over into national strategic objectives. This pathway emphasizes scalability, global competitiveness, and economic leadership, aligning with the logic of value creation and technological power originating from the private sector. Investment is usually guided by market logic, with financial profitability and innovation potential attracting private capital. Under this decentralized ecosystem structure, governments are customers of the private sector. They integrate commercially available products, such as artificial intelligence, cloud computing, and big data analytics, for state use, while companies retain ownership and set development priorities. They benefit from cost-sharing and rapid technological advances, but risk reduced control over strategic assets, oversight, and interdependence, which raises different security concerns. However, state institutions are not regular customers. Using regulatory frameworks, procurement policies, and incentives, they have the ability, and even the responsibility, to adopt a holistic perspective, prioritizing systemic objectives for advancing and scaling the ecosystem's vitality. Thus, they serve as orchestrators and facilitators of the innovation scene, aligning private innovation with broad national objectives. A key distinction between the two pathways concerns dual-use technologies, which have both civilian and military applications. In the National-to-Commercial model, such technologies are typically developed under state control to ensure strategic oversight and security, especially on sensitive technologies, with civilian uses emerging as secondary applications of defense-led innovation. Under these circumstances, the dual use of sensitive technologies presents a challenge rather than an opportunity. By contrast, the Commercial-to-National pathway, characterized by decentralized ecosystem governance, frequently sees dual-use technologies emerging from the commercial sector. Here, the dual use of sensitive technologies presents both opportunities and challenges [71]. Thus, governments have a vested interest in fostering spin-in innovation, adapting private-sector advancements for national strategic purposes, and in sustaining the vitality of the broader ecosystem as a means of securing access to cutting-edge capabilities. This shift from directive to facilitative governance reflects broader transformations in the exercise of state power in the innovation domain, which in turn shape international power distribution. These pathways are dynamic and are not fixed.