The "Greening" of Industrial Policy, Headwinds and a Possible Symbiosis
AbstractThe importance of manufacturing for industrialised countries has been reappraised, specifically in the wake of the financial crisis and of China's rise to world no. 1 in manufacturing. A "new industrial policy" should bolster reindustrialisation, different from the old selective and interventionist one, with proposals by academia, by the European Commission and many national policy makers in the USA, UK and France. It should be pro competitive, in line with societal needs, integrated with innovation and regional policy building on competitive strength and with "sustainability at centre stage". Environmental standards should no longer be considered as an obstacle to competitive manufacturing but could constitute a driver of green growth. Europe sets targets for increasing energy efficiency, increasing shares of renewable energy and cutting emission first for 2020 and then for 2050, demanding the reduction of greenhouse gases by 80 to 90 percent, based on new technologies and prices of carbon dioxide of 250 € per ton. Headwinds to this ambitious path come from low gas prices specifically in the USA, based on a new extraction technology and from the breaking down of the European emission trading. The question now raises whether Europe has to cope with low gas prices as to prevent carbon leakage, or whether Europe can stick to the goals of the envisaged integrated and systemic industrial policy as to raise energy efficiency as well as to reduce carbon emissions by new technologies. A "new industrial policy" would match the US cost advantage in energy by closing the technology deficit, improving skills and going for excellence in energy efficiency and clean technologies.
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Bibliographic InfoPaper provided by WIFO in its series WIFO Working Papers with number 450.
Length: 21 pages
Date of creation: 17 May 2013
Date of revision:
New industrial policy; climate change; carbon leakage;
Other versions of this item:
- Karl Aiginger, 2013. "The "greening" of industrial policy, headwinds and a possible symbiosis," WWWforEurope Policy Paper series 3, WWWforEurope.
- L5 - Industrial Organization - - Regulation and Industrial Policy
- O32 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Management of Technological Innovation and R&D
- O44 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Environment and Growth
- Q3 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation
- Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy
- Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-06-04 (All new papers)
- NEP-ENE-2013-06-04 (Energy Economics)
- NEP-ENV-2013-06-04 (Environmental Economics)
- NEP-PKE-2013-06-04 (Post Keynesian Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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