GTAP Resources: Resource Display
| GTAP Resource #7882 |
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"The macroeconomic and trade impacts of industrial policy nationalism" Authors: Fragkos, Panagiotis, Lukas Hermwille, Kostas Fragkiadakis and Dimitris Fragkiadakis Abstract Industrial policy nationalism threatens international collaboration on climate change mitigation. Using regulatory, fiscal, or trade policies to protect and promote the inter-ests of national industries against external competition may increase the cost of trans-formation and delay the diffusion of key low-carbon technologies. But how large are these effects? And do these measures actually help to achieve the objective of strength-ening domestic industrial competitiveness and resilience of domestic industries? Em-ploying a macroeconomic model, we assess scenarios with varying stringency of pro-tectionism between major industrial economies. We find that industrial policy national-ism may double the mitigation cost for some regions in the most stringent case. Its en-vironmental effects are small as reduced economic growth compensates for less effi-cient climate action. We also show that industrial policy nationalism is hardly effective. Only under the most stringent assumptions can we observe some limited success in boosting domestic competitiveness of green industries. Our analysis provides the first quantitative assessment of a recent global policy trend. Our results highlight the signif-icant collateral damage that industrial policy nationalism can have for the climate and sustainable development and underscore the need for collaborative governance to ad-dress these adverse effects. |
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- Climate change policy - Trade and the environment - Multilateral trade negotiations - Model extension/development - Model validation and sensitivity analysis |
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Public Access No documents have been attached. Restricted Access No documents have been attached. Special Instructions As the paper is under review, can you please restrict public access please? |
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Last Modified: 4/15/2026 11:27:11 AM
