The Political Economy of Industrial Policy

Juhász, Réka and Nathaniel Lane

No 19132, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: We examine the ways in which political realities shape industrial policy through the lens of modern political economy. We consider two broad “governance constraints†: i) the political forces that shape how industrial policy is chosen and ii) the ways in which state capacity affects implementation. The framework of modern political economy suggests that government failure is not a necessary feature of industrial policy; rather, it is more likely to emerge when countries pursue industrial policies beyond their governance capacity constraints. As such, our political economy of industrial policy is not fatalist. Instead, it enables policymakers to constructively confront challenges.

JEL-codes: L52 O25 P00 (search for similar items in EconPapers)
Date: 2024-06
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Related works:
Journal Article: The Political Economy of Industrial Policy (2024)
Working Paper: The Political Economy of Industrial Policy (2024)
Working Paper: The Political Economy of Industrial Policy (2024)
Working Paper: The Political Economy of Industrial Policy (2024)
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