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If the competitors have indeed been subsidised by foreign countries, that's a nice transfer of wealth from those countries to Britain, and, given the low histor
by jsmith99 6y ago
If the competitors have indeed been subsidised by foreign countries, that's a nice transfer of wealth from those countries to Britain, and, given the low historical success of government industrial subsidy, one that only the British will benefit from.
- hyko 6y agoIn a world without a level playing field, the solution to poor quality industrial policy is better industrial policy. Foreign subsidies don’t result in a net transfer of wealth if they undercut your otherwise competitive domestic industry, for obvious reasons. It results in a misallocation of capital and the erosion of opportunities that should have otherwise existed domestically. All countries engage in free market distortion, to varying degrees. That may well be a suboptimal use of their resources, but unfortunately it also hurts countries that don’t respond in kind and who have bought into some simplified economic policy slogans.