Industrial Policy in America

Industrial Policy in America

Breaking the Taboo

Marco R. Di Tommaso and Stuart O. Schweitzer

In contrast to what observers have frequently argued, this timely and thought provoking book suggests that the concept of industrial policy is not alien to the American past and present. The debate on this topic in the US has always been full of contradictory rhetoric and policy practices, and the expert authors therefore acknowledge a need to rethink the traditional antagonist positions. They illustrate that contemporary markets continue to demand to be fixed by government policies, and governments continue to show how fixing-the-market policies might fail. The conclusion is that the future of industrial policy is about how to make both markets and governments better in their functioning, but that the real goal for industrial policy is to make better-market and better-government policies consistent with the goal of building a better society.

Chapter 3: Industrial policy in America’s economic history: a bird’s-eye view

Marco R. Di Tommaso and Stuart O. Schweitzer

Subjects: economics and finance, industrial economics


In this third chapter we focus on America’s industrial development history and in particular on the role that government policies have had in this process. We begin with the independence period – the earliest decades of the country when America started on its path toward economic growth. Then we will look at the years when international economic leadership was finally achieved. We will discuss some of the main moments of economic crisis and we will end offering a more detailed analysis of what happened during the most recent decades. Our intention is to understand whether or not it is possible to find evidence of industrial policy (IP) interventions in American history. The choice of this topic could be considered surprising to some and even provocative to others. This is because there is quite a common argument – widely diffused both in academic and in policymaking circles, in the US and abroad – that IP has never occurred in the US! Is this true? Is IP an idea that has merely been “imported” from abroad? Is it a concept that is totally alien to the US economic culture? And is it a practice in which the American Government has never engaged? Or, to the contrary, is it true that during many crucial periods of US industrial history government interventions have been promoted, even if it might have been called by different names?

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