At the end of the 20th century with stagnating industrial output, unemployment in many European countries has climbed to levels not seen since the 1930s. Interventionist industrial policies thus find new popularity after the gentle flirtation with liberalization in the early 1990s. Under the Maastricht Treaty, the European Union was granted industrial policy powers for the first time. The present study aims to contribute to an understanding of European industrial policy by introducing an historical perspective. National policy continuities and the considerable time over which industrial performance responds to changed environments emerge with greater clarity in the long run. The chapters in this book take a broad view of industrial policy, including those policies that establish the `framework', such as competition law, as well as sector for firm specific policies. The overall conclusion is that improved framework policies, such as liberalization and re-regulation, are still essential. Monetary union in the `core' will increase tensions arising from economic inflexibility. Although there are often strong political barriers blocking implementation of appropriate industrial policies, they will be even more necessary under monetary union.
