Industrial policy, essential for addressing market failures, encounters concerns regarding protecting inefficient firms. We advocate for competition-friendly industrial policies, underscoring the complementary relationship between industrial and competition policies and the benefits of targeted sector-specific subsidies. We emphasize the significance of market competitiveness for sustainable industrial development, drawing from theoretical models and empirical evidence from China.
Philippe Aghion, Mathias Dewatripont and Patrick Legros
21 May 2025
Competition Policy International
https://www.pymnts.com/cpi-posts/competition-friendly-industrial-policy/
This work is published under POID and the CEP's Growth programme.