Industrial policy in Europe: Britain, France, Germany and the European Union

Abstract

The study examines the industrial policy in Britain, France, Germany and in the European Union, and this policy’s capacity to shape industrial outcomes and structures. It analyses the political and economic considerations which affect the industrial policymaking procedures. I argue that the discussion on industrial policy is still too strongly influenced by the debates of free trade and interventionism This overlooks two facts: governments have always played an influential role in industrial affairs and thus, all the activities which are made to shape industrial outcomes are political as much as economic. This argument is backed up by focusing on state and economy linkages where state aids and subsidies constitute the most influential tool in economic and industrial policy-making. Also the descriptive parts on industrialization in selected European Union helps to give on historical depth to the argument. Against this background, the study traces the European Union’s industrial policy from the Treaty of Paris in 1951 to the adaptation of the Maastricht Treaty in 1992. It concludes that today, the Community policy remains to be uncoordinated and underdeveloped. I'his does not constitute a clear and consistent framework for the European industry. The study suggests that industrial policy should be developed and implemented as a coherent framework with a liberal and competitive approach. Thus, Europe can face the world markets and become a global player.