Progressive Industrial Policy in Europe

Werner Raza is Director of Research at the Austrian Foundation for Development Research (ÖFSE). His research focuses on development economics and policy, international trade, global value chain analysis, and industrial upgrading, with a regional focus on Europe, Latin America, and Northern and Eastern Africa.Christa Schlager is Head of the Economic Policy Department at the Chamber of Labour, Vienna. She has written extensively on European industrial policies, fiscal issues, climate policies, and gender issues.Viktor Skyrman is a political economist and postdoctoral researcher based at the Department of Business Studies, Uppsala University, and the European University Institute, Florence. He researches issues related to industrial policy, finance and economic development in various contexts.Michael Soder is an economist at the Economic Policy Department of the Chamber of Labour, Vienna. He is also a lecturer at the Vienna University of Economics and Business and the University of Applied Sciences Campus Vienna.

As this volume shows, Europe faces a crossroads. One path is a narrow, defensive industrial policy centred on competitiveness and security, with the risk of entrenching incumbents and exacerbating inequalities. The other is a progressive industrial policy, mission-oriented and inclusive, designed to accelerate the green and digital transitions while spreading their benefits fairly.- Mariana Mazzucato, Institute for Innovation and Public Purpose (IIPP), University College London Industrial policy is back on the EU agenda, but with much confusion on goals and tools. This book offers a clear map of how industrial policy could reshape production systems in Europe making them greener, more advanced and employment-friendly.- Mario Pianta, Scuola Normale Superiore, Florence Far-reaching and rapid technological, demographic and geopolitical changes, against the background of the need to decarbonise our economies, require a paradigm shift in Europe. No longer can it rely solely on fragmented and market-driven solutions. This book contributes important building blocks towards constructing a genuine European industrial policy capable of enabling Europe to face these challenges.- Andrew Watt, European Trade Union Institute, BrusselsThis is a timely and thought-provoking book that helps us not only to think about what should be the focus and ambition of future-looking industrial policy, but also how we can deliver such an ambitious agenda. An inspiration but also a practical guidebook for the ones who think we need to think and act big to create a better future.- Erkki Karo, Talinn University of TechnologyTo date, the EU's industrial policy strategy has been largely ineffective in increasing environmental, social and economic resilience. This book convincingly explains why this is the case and what needs to change.- Hans-Jürgen Bieling, University of Tübingen

• Introduction – the Why, How, and for Whom of Industrial Policy for the Twin Transformation? Werner Raza, Christa Schlager, Viktor Skyrman and Michael Soder, Part I. External Dependencies of the European Union and How to Tackle Them, 1. Structural Asymmetries and the Limits of Contemporary Industrial Policy: The Risk of Green Divergence in the EU Dario Guarascio, Jelena Relic and Francesco Zezza, 2. Tackling EU Critical Raw Materials Dependencies Bernhard Tröster, Karin Küblböck and Simela Papatheophilou, 3. Technological Dependencies of the European Union: Implications for Industrial Policy Christian Reiner and Roman Stöllinger, Part II. Employment and Labour Market Challenges of the Twin Transformation, 4. On the Way to Net-Zero: How Progressive Industrial Policy Can Shape Employment Change Belá Galgóczi, 5. Policies for the Green Transformation in Europe: the Just Transition Fund in Action Valeria Cirillo, Annaluisa Divella, Eustacchio Ferulli and Lidia Greco, Part III. Governance Challenges of Progressive Industrial Policy, 6. Strategic Outlook, Legitimacy and Directionality: Tackling Key Institutional Deficits of EU Industrial Policy Werner Raza, 7. Past, Present and Future of Innovation Agencies in Europe Rainer Kattel, Part IV. Funding Challenges for Progressive Industrial Policy, 8. Financing the European Union's Progressive Industrial Policies: Strategies Beyond Financial Derisking Viktor Skyrman, 9. Boosting Public Spending for the Twin Transition under the New EU Fiscal Rules: a Proposal Philipp Heimberger, 10. Building a Coherent European Green Macrofinancial Regime: How the ECB Can Leverage the EU's Sustainable Finance Framework to Secure Climate Objectives and Price Stability Gaston Bronstering, Agnieszka Smoleńska and David Barmes, Part V. Outlook, 11. Progressive Industrial Policy for the Global South: a Latin American Structuralist Approach José Miguel Ahumada and Fernando Sossdorf, 12. Towards Progressive Industrial Policy for the EU's Twin Transformation: a Proposal Werner Raza, Christa Schlager, Viktor Skyrman and Michael Soder, Index.