This chapter shows how institutions, and the good governance, can play an important role in economic development. It first looks at theories that marked the development economics up until the 1990s. Next, the chapter focuses on works of new institutional economics, the relationship between good governance, global governance and economic development in order to introduce the issue of innovation in proactive economic policies. The new challenges of globalization reflect on a new development model. If open borders and economic liberalism are the two pillars on which the system of global governance rests, the achievement of this “new development model” should lead economists and political scientists to rethink future economic policies. While technological and social innovation becomes the basis of development, the priority is given to incentives for R&D and human capital that guide the overall economic policy; financial considerations of development then move to the background.