This chapter reviews previous work from the OECD on private sector innovation as well as more recent work on innovation in the public sector. The growing body of knowledge on innovation in the public sector, including social innovation, makes it clear that there is a need to develop a better understanding of the divers, enablers, barriers, and processes specific to innovation in the public services. Specific barriers to innovation in the public sector, for example, include: risk aversion of bureaucracies; political and auditing constraints imposed by performance and accountability frameworks; and inappropriate structures and organisational cultures for innovation. A key yet often missing element to public innovation is rigorous evaluation, which allows both designers and users to identify the precise strengths and weaknesses of a given innovation or reform. As the public sector offers distinct challenges to measuring impacts of innovation and there is as yet no agreed framework for doing so, important public innovations can thus be neglected (or conversely overly supported), with expensive implications for the public purse.