Roles of Industrial Policy

Abstract

Many firms will, as we have seen, try to replace the uncertainties of the competitive process by co-operation or concerted conduct. The large firm is inclined to control its environment by means of some kind of private planning, assuring it more predictable market structure and performance. The public authorities, confronted with these tendencies, adopt two types of policies: on the one hand, they use anti-trust policy to maintain market uncertainty and competitive pressure; on the other hand, they have recourse to industrial policy inspired by sectoral or regional considerations which often results in some form of planning agreement between industry and the state. It is the object of the present chapter to examine the contents of such a policy, its relationship with anti-trust policy and implications for the Community as a whole.