New Trends in Industrial Policies

Industrial policy has returned to the forefront of economic policy discussions, driven by the green and digital transitions, supply-chain resilience, and concerns about market concentration and strategic dependencies. This paper argues that the recent surge in industrial-policy discourse and announcements exceeds the expansion of measurable support. Semantic analyses of the Global Trade Alert database indicate a steep increase in announced measures (from 42 in 2010 to 1,483 in 2022). Using the OECD Quantifying Industrial Strategies (QuIS) database for 17 OECD economies from 2019 to 2023, the paper documents three stylized facts. First, spending through grants and tax expenditures rose by about 10 percent on average (from 1.39 percent to 1.59 percent of GDP), whereas support delivered via financial instruments declined slightly (from 0.97 percent to 0.87 percent of GDP). Second, industrial policy instruments are highly persistent, with limited entry and exit. Third, the observed targets of support have shifted, with expanded schemes related to fixed-capital investment, the green transition, R&D activities, energy costs, and SMEs, alongside reduced sectoral support. The paper then sets out how to design and govern industrial policy using an OECD policy-cycle lens: a clear conceptual framework and objectives, coordination across policy actors and instruments, robust measurement and benchmarking, implementation capacity, and rigorous ex post evaluation. It concludes by emphasizing the need to strengthen evidence on beneficiaries, large-firm subsidies, and cross-border spillovers to ensure industrial policy supports productivity, resilience, and sustainable growth.