Industrial policy

This paper has argued that an active industrial policy that is context appropriate, coherent, and adaptable can be utilised to address this challenge. Nevertheless, one must acknowledge that the necessary green transition on the EU level comes with transition costs, challenges, and opportunities that affect distinct people, firms, and countries very differently, and hence bears the threat of rising inequalities, both within and among countries. Central to the success of a green transition is, therefore, the EU’s adequate reaction to this fact. This reaction can then enable and facilitate a green transformation that really leaves no one behind.

This paper questions the extent to which standard market-fixing and macroeconomic expansionary measures will be able to direct and shape new industrial ecosystems in economies across the Atlantic. Moreover, it advances a strategic industrial policy approach for deep industrial restructuring, followed by a discussion on specific industrial policy instruments and how conditionalities and policy alignments are central to balancing risks and rewards in the process of green transition.

Sustainability transition perspectives are receiving increasing attention in policy and practice. This paper discusses how they can be used to address the net-zero energy transition, which is an extraordinary challenge given its complexity and urgency. It highlights six key principles to guide “transitions based” decarbonisation policies: system transformation, effectiveness, sensitivity to context, adapting policies to transition phases, policy evaluation and learning, and politics.