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Info Service on Biodiversity and Traditional Knowledge (Aug25/06) A progressive framework for green industrial policy In response to the deepening ecological crisis, a recent paper argues that existing “green industrial policies” don’t go far enough – especially in high‑income countries – since they maintain an assumption of continued aggregate growth. The scale and urgency of the crisis require more than just market-based solutions or incremental changes. To address this, the paper proposes a fundamental restructuring of economic priorities and approaches to industrial policy, with a focus on reducing overall resource use in high-income economies while enabling sustainable development in the global South. It proposes a three‑pillar progressive framework:
We reproduce below the Abstract and Conclusion of the paper. With
best wishes, —————————————————————————– A PROGRESSIVE FRAMEWORK FOR GREEN INDUSTRIAL POLICY Jostein
Hauge & Jason Hickel Abstract In the age of ecological breakdown, there is a growing need for ‘green’ industrial policy. However, existing frameworks for green industrial policy fail to address unsustainable growth in energy and resource use in high-income economies. In this sense, they are not adequate to achieve core ecological objectives. This paper fills a gap in the literature by offering a progressive framework for green industrial policy that combines traditional green industrial policy perspectives with insights from ecological economics and literature on post-growth and degrowth. The framework has three key pillars: (1) scale down ecologically harmful industries and sectors to directly reduce energy and resource use; (2) organise production more around public benefit, with greater democratic control and guidance over investment and production; and (3) work towards global ecological justice and enable greater ‘ecological policy space’ for the global South to pursue industrial development. The paper argues that this progressive approach to green industrial policy is necessary due to the scale and urgency of the ecological crisis. The framework shows how productive capacity can be liberated and redirected towards more socially and environmentally beneficial ends, while also democratising control over the economy. [.…] Conclusion This paper has proposed a progressive framework for green industrial policy that addresses the shortcomings of existing approaches in the face of urgent ecological challenges. By combining insights from traditional green industrial policy perspectives with literature on ecological economics, post growth and degrowth, we have outlined a three-pillar approach that aims to achieve core ecological objectives while enabling just economic transformations. The first pillar calls for scaling down ecologically harmful industries and sectors to directly reduce energy and resource use, using credit policy and other mechanisms. This approach recognises that the continuous growth in energy and resource use is unsustainable and that certain industries need to be strategically downsized. This not only reduces ecological harm but also liberates productive capacity that can be redirected towards more environmentally and socially beneficial ends. The second pillar advocates for reorganising the economy to produce for public rather than private benefit, with greater public control and guidance over investment and production. This involves scaling up public investment in ecologically necessary production, aligning policies with democratically determined green transition goals, and increasing public provision of essential goods and services. It also calls for greater financial coordination between various policy levers of the state and a more active role for banks in credit guidance towards environmental objectives. The third pillar emphasises the need for global ecological justice and greater ‘ecological policy space’ for the global South to pursue industrial development. Recognising that high-income countries are primarily responsible for ecological breakdown, this approach calls for differentiated climate responsibilities. It argues for ensuring lower-income countries have more leverage in formulating their industrial policies while advocating for compensation or reparations from the global North for climate-related damages and appropriation of ecological commons. This progressive framework represents a departure from traditional green industrial policy approaches. It acknowledges that the scale and urgency of the ecological crisis requires more than just market-based solutions or incremental changes. Instead, it proposes a fundamental restructuring of economic priorities and approaches to industrial policy, with a focus on reducing overall resource use in high-income economies while enabling sustainable development in the global South. The kind of progressive transformation we call for requires changes to the status quo, shifting away from an economic system that relies primarily on growth-oriented solutions. Luckily, these changes are in high demand. In the research community, a survey of nearly 800 climate policy researchers around the world found that 73 per cent support positions that call for moving towards a world that is not growth-focused (i.e. post-growth) (King et al. 2023). Among the public, a consumer research study found that 70 per cent of people in 20 high-income and middle-income countries support the statement that ‘overconsumption is putting our planet and society at risk’ (Sustainable Brands 2014). Even in the United States, where support for consumerism and growth is supposedly strong, 70 per cent of people believe that ‘environmental protection is more important than economic growth’ (Yale Climate Opinion Maps 2018). On the climate justice front, strong majorities in the global North support compensation to the global South for climate-related damages (Fabre et al. 2023). Clearly, the systemic change we call for is not out of step with the public or with scientists. Of course, even strong public support for a policy framework does not mean it will be implemented. Indeed, it is reasonable to expect very strong resistance from elite factions who benefit so prodigiously from the existing arrangement. The path forward will require not only protest and demonstration – the dominant mode of popular political engagement over the past decades – but the establishment of mass-based political parties that can represent the interests of the working-classes, achieve power, and implement industrial policy measures that can resolve the social and ecological crises of the twenty-first century. Meaningful, systemic socio-economic change has often been unpopular with policy elites, including the British suffragette movement, the civil rights movement in the United States, and the anti-apartheid movement in South Africa (Malm 2020). Nelson Mandela, recognising that the anti-apartheid movement was calling for change that was deemed unrealistic by policy elites at the time, pointed out that ‘It always seems impossible until it’s done’. Although the framework we outline above calls for systematic transformation, the policy pathways are not simply thought experiments. They build on real-existing implementation, both at present and historically, including carbon taxes, credit guidance, anti-trust legislation, consumer protection laws, and public ownership structures. But we do indeed question the status quo of the capitalist economic system more fundamentally than existing frameworks for green industrial policy. It is time for green industrial policy frameworks to consider the views of climate scientists and the public more seriously. While we should continue to take lessons from existing frameworks for green industrial policy, we must advance this field in a more progressive direction. Our aim with this paper is to move the needle in that direction.
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