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German industrial policy and the twin transition: Pre- and post-Covid trajectories in the automotive and IT services sectors

Author

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  • Topuria, Salome
  • Gräf, Helena

Abstract

The European Union (EU) and Germany were already being confronted with rapidly changing dynamics on the economic, ecological, and technological terrains prior to the Covid-19 crisis. The pandemic however has fully exposed critical global value chain (GVC) dependencies, jeopardising European industries. Yet, while the automotive industry was directly hit and worsened by the GVC distortions, the information technology (IT) services sector increased in value. By employing a historical-institutional and a pre-and post- Covid-19 industrial policy analysis, this article finds that in spite of previous attempts, it was during the height of the pandemic that the implementation of green and digital industrial policy gained significant political support in Germany and the EU. In this context, there is an increased relevance of vertical industrial policy, which is geared towards the 'twin transition', partly altering the primarily horizontal industrial policy framework manifested in the post-Maastricht period.

Suggested Citation

  • Topuria, Salome & Gräf, Helena, 2023. "German industrial policy and the twin transition: Pre- and post-Covid trajectories in the automotive and IT services sectors," IPE Working Papers 213/2023, Berlin School of Economics and Law, Institute for International Political Economy (IPE).
    • Handle: RePEc:zbw:ipewps:2132023
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    Cited by:

    1. Qian Zhang, 2024. "The Impact of Digitalization on the Upgrading of China’s Manufacturing Sector’s Global Value Chains," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(4), pages 15577-15600, December.
    2. Butollo, Florian & Staritz, Cornelia & Maile, Felix & Wuttke, Tobias, 2025. "The End of Globalized Production? Supply-Chain Resilience, Technological Sovereignty, and Enduring Global Interdependencies in the Post-Pandemic Era," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 51(4-5), pages 779-798.

    More about this item

    Keywords

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    JEL classification:

    • L5 - Industrial Organization - - Regulation and Industrial Policy
    • L62 - Industrial Organization - - Industry Studies: Manufacturing - - - Automobiles; Other Transportation Equipment; Related Parts and Equipment
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy

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