Green Industrial Policy

Jun 26, 2026

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Green industrial policy is assessed as a route to green growth that depends on green technologies—production methods that conserve exhaustible resources and reduce greenhouse-gas emissions. Access to these technologies can lower social transition costs and support material progress. The paper presents a strong theoretical justification for industrial policy, while addressing pragmatic concerns about hard-to-target interventions. Institutional designs are proposed to mitigate informational and political risks, improving policy effectiveness and investment scale.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages23

Reading Time58 min

Introduction

Green growth and the need for green technologies

The case for green industrial policy

Market failures and spillovers

Mispricing of carbon as a policy rationale

FAQs

What is green growth in the paper, and why does it require green technologies?

Green growth is a development trajectory that uses non-renewable resources sustainably and internalizes environmental costs, especially climate-related ones. Achieving it depends on green technologies that reduce greenhouse-gas emissions and economize on exhaustible resources.

Why does the paper argue for industrial policy to support green growth?

The paper states that green industrial policy has a strong theoretical rationale because green technologies can face obstacles between private and social returns. These include positive spillovers and other reasons investment decisions do not align with societal benefits.

What obstacles does the paper address regarding industrial policy, and how are they mitigated?

Traditional skepticism centers on the difficulty of creating well-targeted, effective interventions. The paper argues these concerns are not insurmountable and emphasizes designing institutional frameworks to counter informational and political risks.

Jun 26, 2026

Upload by Jiven