This paper assesses the effectiveness of vertical industrial policies within the EU. Vertical industrial policy is defined as government support for specific firms or industries (picking winners or supporting losers) and measured by state aid granted by Member States to the manufacturing...

A national-champions-related industrial policy has become (again) en vogue among European politicians. Against this background, our work orders different types of national champions along the industry lifecycle. Different types of locally bound externalities appear along the lifecycle. In a...

This paper provides a tractable dynamic stochastic general equilibrium framework with endogenous firm creation and destruction and variable technology utilization to analyze the macroeconomic impact of entry costs and fixed cost subsidies. Based on this setup, we revisit empirical and...

Attribute-based subsidies (ABS) are commonly used to promote the diffusion of energy-efficient products, whose manufacturers often wield significant market power. We develop a theoretical framework for the optimal design of ABS to account for endogenous product attributes, environmental...

Industrial policy has long been criticized as subject to protectionist interests; accordingly, subsidies to domestic producers face disciplines under World Trade Organization agreements, without exceptions for environmental purposes. Now green industrial policy is gaining popularity as...

The Brazil-Taxation dispute concerns the complaints taken to the World Trade Organisation by the European Union and Japan against seven different Brazilian industrial subsidy programmes. One concerned the automotive sector and represents a clear case of policies dictated by strong domestic...

The resurgence of subsidies and industrial policies has raised concerns about their potential inefficiency and alignment with multilateral principles. Critics warn that such policies may divert resources to less efficient firms and provoke retaliatory measures from other countries, leading to a...

This paper uses new data from the Asian Development Bank (ADB) and its partners, including the UN Economic Commission for Latin America and the Caribbean (ECLAC), to track the importance of trade within global value chains in East Asia and Latin America. The analysis shows that while value chain...

This paper uses new data from the Asian Development Bank (ADB) and its partners, including the UN Economic Commission for Latin America and the Caribbean (ECLAC), to track the importance of trade within global value chains in East Asia and Latin America. The analysis shows that while value chain...

Electronic coordination may drastically reduce transport costs, especially for digital or digitalizable products where local markets may actually shrink to a point in space. In the present paper we use a model with differentiated products to analyze the impact of declining transport costs on...