Industrial Policy after the Crisis

Industrial Policy after the Crisis

Seizing the Future

Patrizio Bianchi and Sandrine Labory

Industrial Policy after the Crisis provides a fresh and insightful study on the lessons that can be drawn from the global financial crisis for the analysis, definition and implementation of industrial policy. The authors utilize a political economy framework for the analysis of industrial development post-crisis, centred on the organisation of production and stressing its importance for the wealth of nations, meaning not only rising income but also ‘justice and happiness’.

Chapter 2: Globalisation and the Organisation of Production

Patrizio Bianchi and Sandrine Labory

Subjects: economics and finance, industrial economics

Extract

The deep, structural roots of the current crisis lie in the extensive transformations that have occurred in the world since the 1970s. Many factors have brought about deep economic, political and social changes – primarily the oil crisis and the first crisis of the international monetary system, but also the end of dollar convertibility into gold, which showed the first sign of weakness of the world order based on bipolarism, and a crisis of the mass production system. Consumers started to ask for more varieties of products, more care for the environment and more room for leisure, in contrast to the mentality of the post-war period up to the 1960s that was based on hard work for later pleasures. This has contributed, at least in developed countries, to a booming services sector. Advertising by large corporations has also certainly influenced this changing propensity to consume (Bailey and Cowling, 2006). Demography in developed countries has started to change with ageing populations, implying new social security needs and new products and services, especially those related to health care and leisure. Technological progress has brought about important changes  in the potential to produce and to live, from the electronics revolution to the development of the information society. Globalisation is often claimed to be a phenomenon arising in the 1990s, but it started much earlier and has been determined by many economic, technological, political and social changes. From the 1980s onwards, the financial sector started to develop rapidly, and above all in a manner distinct...

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