(Emphasis mine)
“Industrial policy” (a.k.a technological central planning), yep, that’s the ticket! See the following posts here:
- “How Semiconductors Bankrupted East Germany” (2023-01-18)
- “Downfall of the British Automobile Industry”
- “India’s Domestic Computer Industry Failure” (2023-07-18)
It is often said that “industrial policy” involves “government picking winners and losers”. But in reality, government picks only losers, since winners can readily find financing in private markets or grow organically from their own earnings.
For a highly relevant historical example about which we haven’t (yet) had a post here, consider the Japanese Fifth Generation Computer Systems (FGCS) project of the 1980s (1982–1992), run by the then-vaunted Ministry of International Trade and Industry (MITI) and “investing” in all of the buzzword technologies of the epoch. All of the usual suspects in the U.S. expressed fear and loathing at the risk this posed to U.S. “technological supremacy” and urged the U.S. to get on the industrial policy bandwagon. When FGCS sputtered to an end in 1994, having spent ¥57 billion, essentially nothing had been accomplished. The copy-cat projects in the U.S., Strategic Computing Initiative and Microelectronics and Computer Technology Corporation (MCC), similarly developed nothing of value except more efficient ways to spend taxpayers’ and borrowed money.