Les Mées Solar Park, France: The cost of photovoltaic systems has fallen rapidly
Image: Lucas Bäuml
There are many misunderstandings about the American subsidy program IRA. Europe must strengthen its location and may only intervene in the market according to fixed principles. A guest post.
Europe is currently experiencing a renaissance in industrial policy. Industrial policy includes influencing the sectoral development of an economy through subsidies, it is about state participation in companies or regulations. Industrial policy can also consist of encouraging corporate mergers to form national champions. These are large companies that are supposed to conquer the world markets with the support of their home countries. It is also common to prohibit foreign investors from taking over domestic companies that are considered to be of strategic importance.
Such interventions have a long tradition. However, they are not always successful. France is considered the motherland of industrial policy. A particularly large number of industrial policy initiatives were undertaken there. These include the development of the Concorde supersonic aircraft or the “Plan Calcul” that was supposed to develop a French computer industry in the late 1960s that would stand up to US companies such as IBM. An expensive failure. Interventions in company takeovers were also questionable. When the US group Pepsi Co wanted to take over the French company Danone in 2005, then French President Jacques Chirac intervened. Why he did this remained unclear. In any case, he earned a lot of ridicule for his “strategic yoghurt policy”.