An industrial policy is any government regulation or law that encourages the ongoing operation of, or investment in, a particular industry. It is often related to, or wholly determinant of, investment policy for that industry. An investment policy is any government regulation or law that encourages or discourages foreign investment in the local economy, e. ...

An active intervention in industrial development is the policy of most if not all countries in the world. Even the United States, which prides itself as a "free-trading" nation, has implemented strong tax, tariff, and trade laws to "protect itself" from "dumping", which is the provision of an industrial subsidy by a competing nation to make products for export. The tax, tariff and trade laws of a political region, state or trade bloc determine which forms of consumption and production tend to be encouraged or discouraged. ... In economics, dumping can refer to any kind of predatory pricing. ...

In Japan, the powerful MITI has often taken an active hand in development of major industries, particularly electronics and software. The impact of this intervention is disputed, as Japan is still not a power in software, and has lost much of its advanced electronics industry to Asian Tigers, especially South Korea and Taiwan. However, authors such as Robert Hunter Wade in 'Governing the Market', provide compelling arguments to support the link between government intervention and the successful industrial development of this whole region. Benefits from foreign investment such as the transfer of technology, skills and managerial techniques that could help infant industries become internationally competitive were captured using policies such as local content rules and joint-venture regulations. As such, the development of infant industries does not simply involve protectionism as the infant industry argument suggests, but is dependent on a country's ability to learn directly from foreign direct investment. Such policies have traditionally been central to the industrial policies of countries that are attempting to catch up with technologically and economically more advanced states. A good example is the US and European attempt to catch up with Great Britain during the 18th and 19th century (see Ha-Joon Chang's 'Kicking Away the Ladder'). Many of these domestic policy choices are now prohibited by the WTO Agreement on Trade Related Investment Measures (TRIPs). The Ministry of International Trade and Industry (通商産業省 Tsūsho-sangyō-shō or MITI) was the single most powerful agency in the Japanese government during the 1950s and 1960s. ... Two digital voltmeters The field of electronics is the study and use of electronic devices that operate by controlling the flow of electrons or other electrically charged particles in devices such as thermionic valves and semiconductors. ... Computer software (or simply software) refers to one or more computer programs and data held in the storage of a computer for some purpose. ... The East Asian Tigers, sometimes also referred to as Asias Four Little Dragons, referred to the economies of Taiwan, Hong Kong, South Korea, and industrialization between the early 1960s and 1990s. ... The Infant Industry Argument is an economic reason for protectionism. ...

Despite the claim that policy was aimed at developing world-class competitors, this is difficult to reconcile with the minimal impact that an active industrial policy has had on immigration policy. Presumably, the nation that seeks to become the global leader in a particular industry must attract many of the most qualified talents in that field, to apply and to improve their own particular individual capital to that problem in that country. Historically, this didn't happen, and the relationship between the immigration and industry-protection rules was at best amminimumbiguous. This suggests strongly that the real purpose of industrial policy was always and only protectionism, the protection of existing jobs for political gain. An immigration policy is any policy of a state that affects the transit of persons across its borders, but especially those that intend to work and to remain in the country. ... Individual capital comprises inalienable or personal traits of persons, tied to their bodies and available only through their own free will, such as skill, creativity, enterprise, courage, capacity for moral example, non-communicable wisdom, invention or empathy, non-transferable personal trust and leadership. ... Protectionism is the economic policy of promoting favored domestic industries through the use of high tariffs and other regulations to discourage imports. ...

Today most industrial policy is subordinated to tax, tariff and trade rules of the General Agreement on Tariffs and Trade (GATT) and various trade pacts promising various degrees of "free trade", which in practice means limited subsidy and no protectionism of any one industry. The tax, tariff and trade laws of a political region, state or trade bloc determine which forms of consumption and production tend to be encouraged or discouraged. ... General Agreement on Tariffs and Trade (usually abbreviated GATT) functions as the foundation of the WTO trading system, and remains in force, although the 1995 Agreement contains an updated version of it to replace the original 1947 one. ... A trade pact is a wide ranging tax, tariff and trade pact that usually also includes investment guarantees. ... Protectionism is the economic policy of promoting favored domestic industries through the use of high tariffs and other regulations to discourage imports. ...

However, notable exceptions including agricultural subsidies in both Europe and the US, and cultural subsidies in Canada, prove that the principle of industrial policy is alive and well, and merely retreating into the shadows. Subsidies status Currently, economic studies place the average farmer subsidy at US$17,000/year for European farmers, and US$16,000/year for U.S. farmers. ... A cultural subsidy is a payment to cultural industries to ensure that some public policy purpose in culture (e. ...

See also

• investment policy
• immigration policy
• tax, tariff and trade
• energy policy