Transformative industrial policy in Europe through a Schumpeterian “looking glass”: Capitalism, sustainability and democracy?

The current industrial transformation towards green energy-based sectors raises, particularly in Europe, major structural challenges. They involve not just systemic transformations of industrial production and supply chains with heavy investments in new, green energy production sites and new, renewable energy grids, but also a possible relocation of industries to more easily accessible renewable green energy sources. At the same time, the (re-)use of existing materials is also reflected in more revolutionary, rather than incremental, applications of circular economy principles with, as a result, more radical shifts in the reliance on local suppliers as opposed to the well-established global value chains. A similar transformation is likely to take place in the agricultural sector.
In short, Europe is likely to be confronted with an industrial structural transformation process with major relocation implications across Europe. This is a transformation the European Commission (EC) is trying to orchestrate from a European perspective, but which individual European Member States are implementing with their own industrial policy interests in mind. We think it is time to look at such transformative industrial policy not so much through a national looking glass as through what we call here the “Schumpeterian” looking glass.