The return of industrial policies: Policy considerations in the current context

Valentine Millot and Lukasz Rawdanowicz ()

No 34, OECD Economic Policy Papers from OECD Publishing

Abstract: The paper contributes to renewed debates about industrial policy in the context of recent initiatives in several OECD economies. It discusses the pros and cons of industrial policies motivated by environmental, national security and place-based/inclusiveness objectives. The paper also considers implementation and design issues, and how to respond to industrial policies in other countries. There are well-grounded economic, social and environmental justifications for some industrial policies. However, there are legitimate concerns that the benefits of such policies could be limited and the costs high. This mainly relates to measures curbing domestic and international competition and the practical and political challenges in designing and implementing effective measures. Thus, while governments may want to experiment with future and welfare-oriented industrial policies, they should exert moderation in scope, exercise caution in design and implementation, and be mindful of possible negative international implications.

Keywords: government subsidies; green transition; industrial policy; innovation; national security; trade policy (search for similar items in EconPapers)
JEL-codes: F13 F52 H2 H81 L5 O25 O3 Q5 (search for similar items in EconPapers)
Date: 2024-05-31
New Economics Papers: this item is included in nep-env
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Persistent link: https://EconPapers.repec.org/RePEc:oec:ecoaab:34-en

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