Transforming Industrial Policy for the Digital Age
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Transforming Industrial Policy for the Digital Age

Production, Territories and Structural Change

Edited by Patrizio Bianchi, Clemente R. Durán and Sandrine Labory

This book argues that digital globalization is inducing deep and productive transformations, making industrial policy necessary in order to reorientate development towards inclusive and more sustainable growth. The book also demonstrates that industrialization remains an important development process for emerging countries. Regarding the future of jobs, the authors show how the substitution of labour in automation is not inevitable since technology is also complementary to human capital. Policymakers should pay more attention to the new skills that will be required. A particular concern is is the rapid change in technology and business compared to institutions which take time to adapt. Territories have an important role to play in order to speed-up institutional adaptation, providing they can act coherently with the other levels of government.
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Chapter 4: Industry and government in the long run: on the true story of the American model

Marco R. Di Tommaso, Mattia Tassinari and Andrea Ferrannini

Abstract

Throughout the history of the United States (US), the dichotomy between free market and government intervention has been a constant. On one hand, the mainstream rhetoric has tended to emphasize the strengths of free markets in guiding the country’s destiny, and persistent arguments have highlighted that government interference in markets would only lead to failures. On the other hand, it is possible to retrace an American model marked by substantial continuity of government intervention to support, protect and expand the national industry in a strategic competitive perspective. In this regard, the last two administrations following the world-wide recession of 2008 – even though adopting different rhetorical styles and sometimes targeting different industries – have both supported the manufacturing sector by means of industrial policies aimed at limiting the severity of the economic decline and at fostering the structural adjustment of the domestic industry. This chapter highlights the conflict between rhetoric and reality within the US industry_government relationship. The authors aim to inform the current debate about public intervention by comparing present practices to the country’s historical policy precedents, beyond an ideological perspective. In other words, they trace and discuss the development of government intervention through the various stages of the country’s industrialization – from the first years of political independence up to the present days of the Trump administration – to provide a long-run interpretation of the American model of industry_government relationship.

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