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Significance

The administration is adopting a 'whole of government' approach to arrest economic decline, enhance resilience, protect the environment, check inequality and revive well-paying manufacturing jobs, via its massive spending bills and a more protectionist trade policy. This is reviving old debates over the efficacy of industrial policy.

Impacts

The need for industrial policy to have a different focus between sectors will continue to limit its effectiveness.

Biden will seek to shape social welfare corporate norms, for instance by making chip makers offer child-care to qualify for federal funds.

Defence and aerospace spending will continue to be a central aspect of each US administration’s industrial policy.

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