A new approach for better industrial strategies

Chiara Criscuolo and Guy Lalanne

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: Industrial policy is back. After having been considered a taboo since the 1970s, “new industrial policies” are at the core of governments’ strategies to support countries during crises and enable the green and digital transitions. Virtually, every government has used and uses industrial policy, despite continued concerns related to anticompetitive effects, within and across countries, captured by vested interests and the opportunity cost of public funds, which economists have pointed out, based on previous unsuccessful experiences. In this paper, we contribute to the debate on industrial policy by presenting both a sound and simple framework to help design industrial policies and also data that allow the comparison of industrial strategies and their priorities across countries. First, this paper summarises our recent framework for industrial strategies, which is designed to offer practical policy advice and shed light on the complementarities between different policy instruments. Such a framework is particularly useful when designing complex mission-oriented industrial strategies promoting the green transition of the business sector. Second, this paper presents some salient results from the new “Quantifying Industrial Strategies” (QuIS) project, which gathers harmonised data on industrial policy expenditures, policy priorities, and policy instruments, thereby allowing the benchmarking of industrial strategies across countries. Based on the aforementioned conceptual framework, QuIS measures industrial policy expenditures across 9 OECD members, for the period 2019–2021. The data, now publicly available on the OECD website, show the importance of industrial policy expenditures, and the growing role of green industrial policies in countries industrial strategies.

Keywords: new industrial policy; quantifying industrial strategies; industrial policy framework; industrial policy taxonomy; green industrial policy (search for similar items in EconPapers)
JEL-codes: L00 L50 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2024-03-26
New Economics Papers: this item is included in nep-ene, nep-env and nep-tid
References: View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Published in Journal of Industry, Competition and Trade, 26, March, 2024, 24. ISSN: 1566-1679

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