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The Financial Times: Three strategies for left-behind places
21 January 2019
The first is a strategy of reversal. This consists of interventions that aim to offset or compensate for the technological and market dynamics that cause cost disadvantages for value creation in left-behind places - place-based investment subsidies, tax credits and the like. This is the most traditional type of industrial policy, and one that is more often marked by failure than success. But they can work: Chiara Criscuolo and her colleagues have examined European investment subsidies for areas that lag behind and found that greater subsidies can increase manufacturing investment and employment — but only by small, existing companies, not the biggest and most productive ones, nor new start-ups.