No fast copy-cat solution

Titled 'Industrial Strategy: UK Sectoral Analysis', it is not a complete strategy, but one of a series of BIS economic papers (BIS Economics Paper No. 18), which "set out the thinking underpinning policy development". It is a thorough document. An interesting part of it is an analysis of past and international approaches to industrial strategy. Prior to 1979, it says, in the UK there was greater emphasis on sectoral (or vertical) interventions that sought to build national champions and promote industrial consolidation; strategic sectors were nationalised; and there was an emphasis on technology push, with government supporting certain technology solutions on the grounds that they offered "greater market potential". This is the oft-named 'picking winners' solution and was "often ineffective at improving the long-term viability of the UK's industrial base", the publication says, with it adding that, post-1979, "some continuity remained, such as support for the aerospace industry, but there was more use of horizontal instruments to encourage foreign investment, promote competition and liberalise markets". At the European and international level, the paper says that horizontal and sector level interventions to address market failures and improve competitiveness, including both supply and demand side measures, are applied in varying degrees. But it is clear that "there is no single prescription, and there are many variants of targeted policies". This last quote is interesting. As far as manufacturing goes, the UK often compares itself with other countries – often Germany, actually. We have been glancing over our shoulder for years, longingly highlighting others' practices and holding them up to government as examples for adoption. With serious action now prompted – by the financial crash – and likely to be sustained, we can, at last, Machinery hopes, switch our gaze to the UK and focus on building our own particular manufacturing landscape. The result will not be a copy-cat of any single country's approach, while with Dr Cable suggesting a 20-year horizon in his announcement, change may appear frustratingly slow. First published in Machinery, October 2012