Modern Industrial Policy Research Articles

Semiconductors and Modern Industrial Policy

Semiconductors have emerged as a headline in the resurgence of modern industrial policy. This paper explores the political economic history of the sector, the changing nature of the semiconductor supply chain, and the new sources of concern that have motivated the most recent turn to government intervention. It also explores details of that turn to industrial policy by the United States, China, Japan, Europe, South Korea, and Taiwan. Modern industrial policy for semiconductors has included not only subsidies for manufacturing, but also new import tariffs, export controls, foreign investment screening, and antitrust actions.

The essence and assessment of modern industrial policy

The state of modern economy is exposed to significant challenges from geopolitical risks and transformation of the process of industrial development, which requires determining the conditions for implementing modern industrial policy and changing directions and priorities of industrial development. Improvement of the ways of production, development of the system of social institutions takes place when solving the issues related to the development of science underlying the formation of new industries. The subject of the study is the transformation of industrial policy features in modern economy at various levels of interaction between government and business. The article examines the changes in industrial development and corresponding transformation of industrial policy tools in import substitution development. The study aims at determining the relationships between the directions and levels of implementing industrial policy in accordance with system analysis and identifying the key features in the relationship between business structures and the state. The theories of industrial development and the concepts of resource and process approaches to industrial development and implementation of innovative industrial policy provide the methodological basis of the study. The study uses the methods of system analysis and synthesis in identifying the key relationships between business structures and the state in achieving the goals of industrial development. The study defines the transformation of types, tools and system of indicators of industrial policy under the sanction pressure on the economy, identifies the possibilities of using the matrix system in managing industrial development, implemented at three levels (macro-, meso- and microeconomic) in interaction of business structures and public authorities, assesses the possibility of forming and conducting conservative industrial policy in the lack of scientific research funding. The findings can be used in assessing the priorities, directions and transformation of the tools used to implement an innovative model of industrial policy in the Russian economy, in the development of import substitution and formation of new industries, to form an effective interaction of innovation process and the process of industrial development of the national economy.

Modern Industrial Policy and the World Trade Organization

This article surveys the economics of industrial policy as it relates to the World Trade Organization (WTO). Motivated by concern that the modern use of industrial policy is emerging in ways that threaten cooperation in the international trading system, the article begins with the basic historical economic framework for tying industrial policy to underlying market failures. It then introduces the dominant economic understanding of the role played by the WTO, examining the WTO's rules on subsidies (and thus industrial policy), the unease with the evolution of the trading system's subsidy rules, gaps in knowledge, and important data and measurement shortcomings. The main part of the article examines four areas in which modern industrial policy operates differently and has become especially important for the trading system: China, supply chain resilience, supply chain responsiveness, and climate change. The article identifies the evidence to date, open questions, and potential paths forward for economic research to help inform policymakers’ efforts to restore international economic cooperation in trade and industrial policy.

International economic law and the reinvention of industrial policy: Opportunities, limitations and risks

BACKGROUND: Many studies are focused on traditional (old) or modern (new) industrial policy. There are insufficient studies linking the emergence of the knowledge economy and the institutional requirements to underpin inclusive social and economic development in developed or developing countries. OBJECTIVE: This study aims to analyze the characteristics of the knowledge economy and the institutional requirements for more inclusive and sustainable socio-economic developments. Constraints of the international economic law in its current form for more inclusive and sustainable industrial policy in developed and developing countries will be put forward. The inclusive knowledge economy requires not only innovative advanced firms but also innovative and creative public sector employees capable of supporting and disseminating opportunities of the knowledge economy to the entire society. Moreover, the inclusive knowledge economy requires lifelong learning processes of the workforce in developed and developing economies. Therefore, a human dimension, broad participation, and shaping of modern development strategies a key to developing an inclusive and sustainable knowledge economy. Institutional constraints of the international economic framework are currently not adequately supportive of such a structural shift. The objective of this study is to show the possible adjustments at the international and national levels to support the development of an inclusive knowledge economy. The human dimension (participation, creativity, imagination) of the public and private sector goes hand in hand with institutional innovations. METHODS: The normative and institutional analysis, embedded in the historical context of industrialization patterns in the selected countries, will provide insights into the institutional requirements for an inclusive knowledge economy. RESULTS: The result of the conceptual and normative as well as empirical comparative analysis will provide insights into the possibilities and needs for institutional innovations at the regional, national, and supranational levels of polity while embracing the need for a more supportive international normative context. Several possible institutional innovations at the national levels, such as regional public venture funds, decentralized support, and training centers, are provided. A reform of the Agreement on Subsidies and Countervailing Measures to better delineate between potentially productive and harmful subsidies at the international level can be seen as a reform proposal at the international level. CONCLUSIONS: Industrial policies in developed and developing countries will not be able to address the social and economic divides between advanced and stagnating sectors of the economy without addressing the requirements for institutional innovations at all levels of the international polity.

LOGISTICS CLUSTERS AND THEIR POTENTIAL FOR ECONOMIC DEVELOPMENT

Supply chain resilience in the face of shocks has arisen as a policy issue due to the multilateral trading system lowering trade barriers. Innovations in transportation technology created intelligent transport systems and production fragmentation of global supply chains. However, climate shocks and the COVID-19 pandemic restructured supplies in the global markets. At the same time, geopolitical conflict and tensions emerged with Russia’s invasion of Ukraine, increased China’s military activity, introduced additional tension, and created difficulties for the supply chains. On the other hand, the current industrial policy, aiming at national economic growth, is motivated by objectives different from increasing company-level productivity or spillovers between sectors. The concern primarily revolves around supply chain resilience, the fear of weaponizing exports, supporting technological advancement, and the need for policymakers to introduce greater control over economic activity in anticipation of potential shocks. In cross-border supply chains, some governments seek to coordinate their industrial policies with the most significant partners without implementing measures at the national level (Bown, 2023). Overlaying other considerations is the existential threat of climate change, a significant driver behind many modern industrial policy initiatives. That is leading to the rebirth of the idea of logistic clusters uniting different partners in size with foreign trade-oriented activities, aiming at efficiency as well as resiliency of the logistics chains. Based mainly on deep secondary research, this paper addresses the rebirth of cluster ideas in international transport and logistic activities.

Modern Industrial Policy and the WTO

Modern Industrial Policy and the WTO

Промышленная политика и инновационный процесс в современной российской экономике

The article is devoted to the analysis of the relationship between effective industrial policy and the innovation process in the modern economic system. The industrial policy determines the specifics of the industries development, the competitiveness of individual industrial enterprises and is based on a set of economic policies implemented by the state; however, it also has its own features. Innovation and investment processes are the basis of effective industrial policy. The purpose of the study is to consider various approaches to determining the interdependence of effective industrial policy and the innovation process of foreign and Russian scientists, as well as to analyze the factors and conditions that ensure the effectiveness of the state industrial policy implementation. As part of the analysis of factors and conditions that ensure the effectiveness of the state’s industrial policy, the article assesses the advantages and disadvantages of the industrial policy implementation and its impact on the state’s to form and regulate the innovation process. The author uses methods of scientific analysis and synthesis. The positive and negative features of the industrial policy implementation in modern Russian economy in the context of globalization are identified, the underestimation of the business sector’s role in the innovation process implementation is revealed. The factors that reduce the effectiveness of the industrial policy innovative model implementation due to the inconsistency of the tools and methods are identified. The conditions for ensuring the long-term economic development effectiveness are revealed. Modern industrial policy requires consideration of the factors influencing its efficiency, as well as the specifics of the investment and innovation process implementation in the national economy’s industrial development in the context of globalization. The improvement of the existing scientific research and education systems will ensure the long-term advanced development of domestic industry, provide an opportunity to develop import substitution and occupy new niches in the global economic system. Industrial policy is determined by the peculiarities of the innovation process implementation in the economic system. An innovative model of industrial policy implementation can ensure the long-term development of the national economic system and increase its competitiveness.

Industrial policy of Ukraine: implementation of occupational standards to ensure qualified personnel

The purpose of the article is to study the place and role of occupational standards in providing industry with qualified personnel and to define main tasks and problems of their implementation in Ukraine. Research methods: dialectical, abstract-logical, induction and deduction, analysis and synthesis, analogy and comparisons, system, complex and content analysis. Approaches to the formation of modern industrial policy are analyzed, attention is focused on the main determinants of EU industrial policy - the creation of a favorable environment for the development of small and medium-sized businesses and equal opportunities in conditions of competition, which means the struggle to achieve better conditions of access to limited resources. The role of qualified personnel as the scarcest resource that determines the competitiveness of industry is shown. The problem of the shortage of qualified labor for industry in Ukraine is highlighted, the solution of which requires the creation of conditions for the development of competition and ensuring the training of professional personnel in accordance with the needs of industry, in particular – by modernizing occupational standards of industrial specialties. The place and importance of the implementation of occupational standards in providing industry with qualified personnel, their relationship with the education system and the labor market, and main problems of implementation are defined. It has been proven that employers' decision to introduce occupational standards "affects" the most sensitive foundations of labor relations – employment (the employees’ compliance with the requirements for qualifications, education, etc.), remuneration of labor (rate fixing), conditions and safety of work. Conclusions were made about the need to develop the Methodology for the introduction of occupational standards, the existence of a wide field for the joint activity of social partners on the basis of ensuring the transparency of the transition to occupational standards for employees, the use of existing mechanisms of social dialogue for the participation of personnel, in particular – through the representation of trade unions, in the activities of the working group on the introduction of occupational standards.

КЛЮЧЕВЫЕ ЭЛЕМЕНТЫ И ЦЕЛИ ГОСУДАРСТВЕННОЙ ПРОМЫШЛЕННОЙ ПОЛИТИКИ РОССИЙСКОЙ ФЕДЕРАЦИИ

This article describes in detail the challenges and opportunities of the Russian industry in the period 2023-2026. The need for new logistics solutions and infrastructure investments is highlighted. Despite the positive trends, the economy is facing inflationary pressures, high prices and a possible increase in interest rates. It is separately highlighted that modern industrial policy is aimed at the development of industries through the stimulation of innovation, ensuring the growth of high-tech high-tech industries and increasing competitiveness.

Regulatory Support and Institutions for the Transformation of Enterprises to the Digital Economy

Regulatory support and institutions for the transformation of enterprises to the digital economy are considered. In particular, the basic institutions of the transformation of enterprises to the digital economy, inherent in any society: social (or socio-cultural), economic, political, were studied, and their structure was summarized. It is substantiated that it is the state that is entrusted with the task of ensuring the effective functioning of institutional and legal foundations and long-term development vectors of the country and enterprises in Ukraine. In the conditions of wartime and the development of the digital economy, it is necessary to create a structure of incentives and motivations for digitalization at the enterprises themselves. The institutional and legal foundations of the digital transformation of enterprises by the institutions of state power are considered. The main legislative support for the formation and development of the digital economy in Ukraine is presented, the policy directions of the Ministry of Digital Transformation, its implementation of projects for the development of the digital economy, which create conditions for the development of business in Ukraine, the transformation of enterprises to new operating conditions, the development of human capital, and the preservation of labor potential are considered. The impact of supranational institutions and European integration on the establishment of institutional and legal foundations for the transformation of enterprises to the digital economy is outlined. The main directions of Ukraine’s cooperation with the European Union in the development of the digital economy, which are among the priorities in cooperation, were considered. Proposals regarding the improvement of institutions for the transformation of industrial enterprises to the digital economy are substantiated and relevant recommendations are provided. In particular, it was noted that Ukraine needs a modern industrial policy with defined principles and a vision. A strategy of industrial development is necessary, taking into account the digital economy, martial law, losses of industrial and labor potential, the need for post-war recovery and the adoption of the Law of Ukraine «On State Industrial Policy». The state industrial policy must meet the requirements of the times, therefore it should include the tasks of digital transformation of industrial enterprises and stimulating mechanisms of digital transformation.

Economic Imperatives of Evolving National Digital Policy: A Call for a Modern Industrial Policy Framework in India

ABSTRACT The world economy is witnessing the rapid digitization of global production, trade, and consumption of goods and services, which is significantly impacting economic activities in both developing and least developed countries. In this article, we examine and review the evolving framework of the national e-commerce policy in India and map digital policies in the broader contours of the industrial policy framework. Findings of this article show that interventionist policies such as localization of data and restrictions on cross-border data flows are vital for building domestic digital infrastructure, firms, platforms, and capabilities.

СУЧАСНА ПРОМИСЛОВА ПОЛІТИКА ТА ІННОВАЦІЙНА СТРАТЕГІЯ ЄВРОПЕЙСЬКОГО СОЮЗУ

Industrial policy determines the guidelines for developing the innovative power of any entity in the global economy, including the European Union. The effectiveness of industrial policy contributes to the favourable innovation climate and is the driver of economic development. Thus, the analysis of the European Union's current industrial policy and innovation strategy is essential for Ukraine. The article aims to study the current industrial policy and innovation strategy of the European Union. The work examines the current industrial policy and innovation strategy of the European Union. It is noted that the evolution of modern industrial policy in the European Union is associated with the use of two models: vertical (selective) and horizontal (functional). It analyses the provisions of the New Industrial Policy of the European Union 2021–2027, which were grouped in three documents. The measures proposed by the European Commission for the restructuring of European industry have been identified. It has been found that today the European Union ranks only third (after China and the United States) in the development of innovative researce and development. The research reveals that the European Union today actively uses the existing integration tools as a priority to "pull" the lagging countries to the level of innovative development of the advanced group of member states. Restrictions on the domestic policy of the European Union member states in technological development have been systematised. The article analyses the current strategy of the European Union in the field of innovation and reveals the goals and directions of innovation development provided by it. It presents the most important mechanisms that form the basis of the European Union's policy in supporting "open innovation". However, it is concluded that the European Union today is actively using existing integration tools to "pull" lagging countries to the level of innovative development of the advanced group of member states (27), which should lead to increased innovation and competitive power of the European Union as a whole.

ЭВОЛЮЦИЯ ЦЕЛЕЙ И ИНСТРУМЕНТОВ РЕГИОНАЛЬНОЙ ПРОМЫШЛЕННОЙ ПОЛИТИКИ ЕС: БЕНЧМАРКИ ДЛЯ РОССИИ

The strategic guideline for the Russian Federation, stipulated by the Strategy for Spatial De-velopment, is to strengthen the connectivity of the economic space, modernize the sectoral structure, and stimulate the dynamics of the industrial production of the territories. The formation of a regional industrial policy, coordination with global scientific and technological priorities and the possibilities of the territories is considered as a driver of Russia's recovery growth. The article analyzes the experience of European coun-tries, presents the evolution of the priorities of the industrial development strategy, systematizes effective tools and practices for updating the EU industry. The industrial policy of the EU is studied by the authors in two dimensions: 1) taking into account the integration goals and the potential of institutional support; 2) from substantive positions, in terms of priorities, tasks, mechanisms for the transformation of industry. The high elasticity of transformational changes in response to global challenges has been revealed: multiplicative en-richment of subject goals (“innovations – digitalization – resource-saving technologies – industrial ecolo-gy”); creation of a comprehensive toolkit focused on the complementarity of the industry of the EU coun-tries, focused on platform solutions, digital connectivity, environmental neutrality. The position on the pres-ence of out-of-country patterns and qualitative stages of modern industrial policy in countries and macro-territories with a heterogeneous economic space is substantiated, benchmarks of effective solutions are iden-tified in the context of systemic government support for transformational changes in the industry of territories with different levels of development. The obtained conclusions can be used in the development of decisions in the field of state regulation of the industrial policy of the constituent entities of the Russian Federation.

A Modern Industrial Policy for the Czech Republic: Optimizing the Structure of Production

The decreased demand for new vehicles will put pressure on the economy of the Czech Republic, a country deeply integrated into global value chains, as part of global vehicle production. The aim of this research was to define an appropriate industrial policy for the Czech Republic that will ensure that the country maintains its competitive position in the global market. A constrained optimization model was built, based on input–output analysis, to determine the optimal value-added structure and the intersectoral structure of the Czech economy for the country to retain its exporting character. The optimization problem was solved by using a particle swarm optimization algorithm. The results suggest that the optimal industrial policy plan for the country is the structural transformation of production, mainly targeting the development of technologically advanced sectors of manufacturing (such as: chemicals and chemical products; basic pharmaceutical products; computer, electronic, and optical products; electrical equipment; and machinery and equipment). The suggested restructuring process increased the domestic value-added in gross exports as a share of total exports by 6.77%, creating optimal production capabilities for the economy. The Czech Republic appears to have the potential for the implementation of an industrial policy, avoiding the increasingly vulnerable motor-vehicle sector.

Региональная промышленная политика в арктических территориях: какая она есть и какой ей быть?

The moment of truth for regional industrial policy in the Arctic has arrived. At the federal level, the need for an active state policy in the Arctic has been recognized — in recent years, state and private corporations have been implementing a dozen new projects. But there is no clarity in the priorities, directions, versions of the regional industrial policy in the Arctic. Based on the analysis of regional strategies for the socio-economic development of the Arctic territories, seven directions for an active industrial policy are outlined: energy, food and transport security, industry of local building materials, environmental industry, production localization of corporate projects and restructuring of production in old industrial cities and regions. The analysis of regional industrial policy laws confirmed that their context and advancedness depend on the size and internal structure of the regional industrial sector. Despite the huge role that corporate structures play in the aggregate industrial production, the issues of interaction with them and the formation of a general agenda for industrial policy, are indicated in most of the provisions absolutely insufficient. In general, in the Russian Arctic, the district industry forms about three quarters of the total industrial product. The dichotomy of urban and district industry within the industrial sector of the Arctic regions means the need to significantly differentiate the instruments and institutions of local industrial policy within the Arctic zone. The assessment of industrial production volumes, carried out at the level of Arctic municipalities, made it possible to determine the sequence of regions: Yamal- Nenets Autonomous Okrug, Arctic Krasnoyarsk Territory (Norilsk Industrial Region, Taimyr and Evenkia, Turukhansk District), Murmansk Region, Nenets Autonomous Okrug, Arctic territories of the Komi Republic, Chukotka Autonomous Okrug, the Arctic part of the Arkhangelsk Region, the Republic of Karelia and the Republic of Sakha (Yakutia). Based on the developed corporateness index of the local industrial sector, six groups of municipalities (supercorporate, high corporate, dynamic, medium corporate, low dynamic and unincorporated) were identified, for each of which its own package of measures of local industrial policy is advisable. Four different situations of interaction between the main actors of regional industrial policy, represented by regional authorities and companies, can be distinguished: the first is the absence of a corporate structure, when industrial policy is solely carried out by local authorities; the second is the isolated existence of power and corporate business, dangerous by the Dutch disease and the fading of local initiatives in the field of new production projects; the third is a collision of interests between the authorities and business that is destructive for the region and for the dynamics of development; and the fourth is the active interaction of regional authorities and companies with the receipt of synergy effects in regional industrial policy. Popular instruments of modern industrial policy in the form of clusters, parks and zones should not be isolated “cathedrals in the desert”, but effective platforms for integrating the efforts of the authorities, corporations, local business, scientific and educational structures of the region in the implementation of projects and measures of industrial policy. The most important factor in the success of the regional industrial policy in the Arctic is the implementation of the strategy of the owner-region.

New Strategic Approaches to Gaining from Emerging Advanced Manufacturing Markets

Advanced Manufacturing (AM) markets are a major factor of contemporary worldwide growth that to a large extent determines countries’ competitiveness. Strengthening and/or optimizing the positions on AM markets is among the major challenges for modern industrial policy. This article discusses the structure and dynamics of the development of advanced manufacturing markets, as well as the specifics of the policies of the countries strengthening their positions in these markets. Gaining entry into AM markets currently implies individual countries’ and industries’ adopting different models which combine a wide range of factors. Small nations are rapidly applying such approaches, gaining advantages and thus increasing their competitive edge, which creates certain challenges for leading high-tech countries too slow to adjust their industrial policies. So far the basis for Industry 4.0 markets is just emerging, and remains limited to a few nations including developing ones. Country cases are presented below to illustrate the development of AM markets. The authors conclude that in the current context, no universal approaches to shaping a successful industrial policy remain. The most productive strategy is to combine the unique advantages of a particular economy.

СОВРЕМЕННЫЕ ВИДЫ ИЗОБРЕТАТЕЛЬСКОЙ АКТИВНОСТИ ТЕХНИЧЕСКОЙ ИНТЕЛЛИГЕНЦИИ

The present technical intelligentsia, engaged in industrial production, has a significant intellectual potential, which is realized in its inventive activity. There are two ways of implementing that: formal and informal. The formal path (the possibility of registering its inventions through patents and the formalization of intellectual property) is characterized in general by a trend towards a decrease in applications for industrial designs, as well as uneven submission of them from the regions. The most popular and actively used among representatives of the technical intelligentsia is the informal method, which makes it possible to prove oneself among like-minded people and discuss the complexities of the patenting and implementation, new industrial designs, as well as business ideas, startups, features of modern industrial and scientific and technological policies on electronic platforms and forums.

By the question of determining the place of non-public joint stock companies in the implementation of modern industrial policy of the Russian Federation

By the question of determining the place of non-public joint stock companies in the implementation of modern industrial policy of the Russian Federation

Trends on the conception of competitiveness and modern industrial policy: The emergent field of a new synthesis

The concept of competitiveness and the practice of industrial policy seem to acquire a repositioned meaning and new interest today. We explore how the concept of competitiveness is changing shape and scope and what is the focus of industrial policy both historically and recently in the effort of finding their theoretical convergences and divergences. The findings suggest a move towards an industrial policy that is systemic and integrated since it focuses on enhancing the multilevel competitiveness of the socio-economic system in a unified micro-meso-macro approach. A counter-proposed analysis of the “competitiveness web,” which perceives at the centre of the system the evolutionary micro-dynamics of the firm surrounded by co-evolving meso-dynamics and macro-economic and macro-social environments, enhances our understanding towards an “organic” industrial policy that focuses on strengthening the multi-level competitiveness.

Theoretical, Institutional and Ethical Basis for Implementing Modern Industrial Policy. Part II

Theoretical, Institutional and Ethical Basis for Implementing Modern Industrial Policy. Part II