Nicholas Decker (@nicholasdecker): "Most studies of industrial policy tell us literally nothing about whether industrial policy is good or bad. All they can measure is partial equilibrium evidence, but are silent on whether all that intervention actually made the country better off."

The app for independent voices

Aug 19, 2025

Most studies of industrial policy tell us literally nothing about whether industrial policy is good or bad. All they can measure is partial equilibrium evidence, but are silent on whether all that intervention actually made the country better off.

I want to illustrate this with some examples of papers which, no matter how impressively identified they may be, don’t actually say anything of importance. Barwick, Kalouptsidi, and Zahur (2024) have a piece in the JEP on the effect of shipbuilding subsidies in China and South Korea on expanding the shipbuilding industry. They can say that it increased shipbuilding – but they can say absolutely nothing about the welfare consequences!

Nicholas Decker

Aug 19

6:35 AM

The app for independent voices

Log in or sign up