Industrial Policies for Technological Change: the Case of West Germany

Abstract

As a branch of the “New Interventionism” (1), industrial policy in the Federal Republic of Germany has — as elsewhere — a long record which can be traced back to the so-called structural policy. It is only new insofar as the explicit promotion of technological change and innovation has begun to receive more attention since the early 1960s. The following presentation of the policy is restricted to public assistance provided directly to the business sector and hence excludes the financing of basic research in universities and non-profit organisations. It concentrates on an analysis of the policy structure as it developed during the last two and a half decades; an assessment of its general importance and likely impact, and public-choice arguments which may help to explain the conduct of policy.

The pressures, constraints and incentives affecting politicians, civil servants and their advisers, should be subjected to the same analytical scrutiny as are those affecting business firms, trade unionists and consumers.

Samuel Brittan (1973), Capitalism and the Permissive Society London, Macmillan, 1973, p. XVII