Shifting patterns in the application of industrial policy

Abstract

The practice of industrial policy in economically advanced jurisdictions is examined, focusing on the post 2000 period. Building from literature and cases from the Canadian automotive industry, the paper demonstrates how actors engaged in the application of industrial policy in economically advanced, high labour cost jurisdictions have responded to shifting pressures and opportunities. Explanation is provided for how those changes have caused objectives to broaden from a focus on manufacturing to industrial R&D. While vertical industrial policy tools endure, the transition has prompted increased emphasis on horizontal industrial policy instruments. The cases also demonstrate that a shift has occurred from externally-generated projects towards internal, organic forms of development, a change that has elevated the primacy of internal, corporate champions in firm level investment attraction.

Upgrading in the Automotive Periphery: Turkey's Battery Electric Vehicle Maker Togg

“…Therefore, a range of factors have resulted in escalating competition among national and subnational jurisdictions for automotive investment (Jacobs, 2015, 2017; Mordue, 2020; Thoburn and Natsuda, 2018). Turkey has responded in a resolute manner: the capacious application of industrial policy to provoke the establishment of a new, indigenous automaker, Togg, that its proponents claim will alter the profile of Turkey's automotive industry, shifting it from integrated periphery status to one that holds a primary attribute associated with core automotive countries; and hosting the headquarters of a global lead firm (see Mordue and Sweeney, 2020; Pavlínek, 2018, 2020).…”

“…While emphatic, Turkey's support for automotive investment is not exceptional. Since the industry's earliest days, the anticipation of wider benefits has caused countries to develop an evolving suite of industrial policy measures aimed at enhancing national and regional automotive ecosystems (see, for example, Anastakis, 2005;Jacobs, 2015Jacobs, , 2017Mordue, 2017Mordue, , 2020Wilkins and Hill, 1964). Togg, however, is unlike recent automotive investment case studies.…”

“…In the post-2000 period, the aim of national and subnational automotive industrial policy makers in market economies (i.e. excluding China) has been incremental investment by existing automakers or suppliers (see Jacobs, 2015Jacobs, , 2017Mordue, 2020;Thoburn and Natsuda, 2018). Thus, the path pursued by Turkey via Togg -devising industrial policy measures to support an entirely new OEM -is, so far, unique in Europe and North America.…”

“…Since the recession of 2008–09, several authors have noted a resurgence in industrial policy (Chang and Andreoni, 2020; Rodrik, 2011; Warwick, 2013). Much of the industrial policy research during this period has been based on analysis of the dynamics associated with the automotive industry and the attraction of specific, limited mandates from the industry's non‐resident OEMs (see Jacobs 2015, 2017; Lampón et al., 2014; Lee and Mah, 2017; Mordue, 2017, 2020). However, for states whose aim is to support the development of a new home‐grown global lead firm, the tools are considerably more expansive (McGuire, 2014).…”

Changes in productivity and labour relations: Artificial Intelligence in the automotive sector in Portugal

“…The article first contextualises the automotive sector in the world and in Portugal (Mordue, 2020;Mordue and Sweeney, 2017). Evidence from databases and interviews around cases will be presented approaching the implications of R&D projects in productivity and employment in the Portuguese automotive sector.…”