Journal of Industrial and Business Economics - Call for Papers: Special Issue on European competitiveness in the new global context: structural constraints, strategic dependencies and the role of the new industrial policy

Guest Editors
Dario Guarascio (Sapienza University of Rome, Italy)
Mario Holzner (Vienna Institute for International Economic Studies, Austria)
Donato Iacobucci (Marche Polytechnic University, Italy)
Valentina Meliciani (LUISS University, Italy)

Summary
As the global economy becomes increasingly confrontational and fragmented (Baldwin and Freeman, 2022), the competitiveness of European industries is seriously threatened (Crespi et al., 2021; Celi et al., 2022). Dependence on energy and critical raw materials, technological gaps in key domains (e.g., semiconductors, batteries, photovoltaic panels), as well as persistent core-periphery divides represent important challenges and require new policies (European Commission, 2022; Amighini et al. 2023, Edler et al., 2023, Juhász et al., 2023; Mazzucato and Rodrik, 2023). Such developments may have substantial effects on the shape and intensity of global (as well as regional) trade and production networks, including European ones (Javorcik, 2020; Miroudot, 2020; Aiyar et al., 2024). As the actors dominating key value chains (VCs) try to ‘weaponize interdependencies’ (Drezner et al., 2021), re-shoring and ‘friend-shoring’ are seen as potentially effective risk-mitigation strategies (Aiyar et al. 2024). This may lead to new ‘regionalization’ patterns, including strengthening or fragmenting old clusters as well as favoring the emergence of new ones (Bontadini et al., 2022, Coveri and Zanfei, 2023, Giovannetti et al., 2023). Yet, the evidence is inconclusive regarding the actual adoption of these strategies, their scope and effectiveness in reducing risks and, hence, increasing resilience along VCs.

In the European context, there seems to be an emerging drive towards a new industrial policy aimed at directing markets towards longer-term goals under the banner of technological sovereignty and geo-dirigisme (Edler et al., 2023; Mazzucato and Rodrik, 2023; Seidl & Schmitz, 2023). There are considerable challenges ahead, however. The German-centered export-led growth model is revealing all its fragility, hinting at the need to radically change the EU's economic policy strategy, strengthening the domestic market and the technological and productive capabilities in key industries (Guarascio et al., 2024). There are multiple symptoms of such fragility: weak macroeconomic performance, technological backwardness in critical areas, low employment growth, overreliance on exports, as well as imports of strategic inputs (Germann, 2022; Cresti et al. 2023, Gehringer, 2023). Moreover, European economies show an uneven capacity to specialize in high value adding activities within industries where they are active (Timmer et al., 2019; Stöllinger; 2021, Coveri and Zanfei, 2022; Bontadini et al. 2024). These symptoms of fragility are particularly problematic when it comes to the ‘twin transitions’ (i.e., digital and green transitions), as the European Union (EU) exhibits a weak position in key VCs and a high degree of technological and Critical Raw Materials (CRMs)-related dependency, particularly in sectors that are crucial to achieve goals such as digitalization and de-carbonization (Bontadini et al., 2023; Caravella et al., 2024). Dramatic disruptive events and geopolitical tensions have further highlighted the vulnerability of European industries to changing conditions in the access to energy inputs and key components, as happened during the pandemic (Giammetti et al, 2020, Strange, 2020) and the ongoing Russia-Ukraine conflict (Mariotti, 2022; Sturm 2022; Weber et.al. 2023). However, the empirical evidence on the EU's positioning in relevant VCs is still scarce at best, and comprehensive analyses identifying the actual nature, causes and consequences of such dependencies are still missing. 

To strengthen technological and productive capabilities, the 'new' EU industrial policy may play a crucial role. The policies launched by the EU Commission now target strategic industries, products and technologies, breaking away from the previous approach based on sectoral and technological neutrality. The idea of “Open Strategic Autonomy” (Bauer and Erixon, 2020) endorsed by the European Commission has prompted an in-depth reflection on how to boost production capacity in key industries and technologies, while developing more diversified, less risky and more resilient supply chains (Gereffi et al., 2022; Capponi et al., 2024). However, the risk that old contradictions (e.g., inadequate fiscal capacity at the central level, poor coordination of industrial policies by the EU and its member states, an imperfect banking union, etc.) jeopardize its key objectives is all but negligible. If anything, this is another area of research where both quantitative and qualitative analyses are sorely needed, to assess whether the new EUs industrial policy strategy is apt to the task or if, on the contrary, it risks falling short of some of its major goals.

This Special Issue (SI) has the ambition to analyze the competitiveness of European economies and its industries in the new global context. In particular, it is intended to bring together theoretical and empirical contributions to the debate on strategic dependencies and new economic asymmetries by focusing on their causes and consequences, as well as the policy tools that could address them. In this respect, contributions assessing whether the new EU's industrial policy is up to the challenge of the green and digital transition will be strongly encouraged as well as studies looking at the evolution of European digital and green value chains. Finally, the SI aims to understand how the evolutionary trajectory of key EU member states have influenced (and may further influence) the structural conditions of the European economy.

In what follows, a (non-exhaustive) list of the research questions that this SI is willing to address:

• What are the areas (i.e., products, technologies, CRMs, functions) where Europe displays the stronger dependency or where, on the contrary, it is better positioned? 
• How heterogeneous is the impact of recent shocks on European industries? Are they likely to increase core-periphery divergence in Europe?
• What is the positioning of the European economy in VCs that are key for the green and digital transition?
• Are EU economies implementing strategies of re-shoring and/or friend-shoring? What is their impact on economic and technological competitiveness? 
• What is the role of specific countries (e.g., Germany) and industries (e.g., automotive) in the current European positioning in key VCs and to what extent the evolution of such countries/industries affect European economic prospects?
• Is the EU’s industrial policy agenda able to cope with the new global competitive scenario under the banner of technological sovereignty and protectionism?
• Which are the advantages and disadvantages of the emergence of policies oriented towards increasing self-reliance at the national or macro-regional level? To what extent could these policies strengthen the productive and technological capabilities of EU’s industries? Could these policies, on the contrary, constrain technology diffusion, open science, static and dynamic economies of scales?
• How do Open Strategic Autonomy policies interact with competition and regulatory policies (e.g., FDI screening) at national and European level?
• Is the new EU industrial policy apt to the challenges posed by the new global context, particularly concerning the achievement of key goals such as digitalization and de-carbonization?
• How do macro-regional level industrial policies for the governance of EU competitiveness translate into policies at the national and subnational levels?

References
Aiyar S., Malacrino D., Presbitero A.F. (2024) Investing in friends: The role of geopolitical alignment in FDI flows, European Journal of Political Economy, Article in press, DOI:10.1016/j.ejpoleco.2024.102508
Amighini, A. Dietrich, M., Garnizova, E., Hagemejer, J., Maurer, A., Roy, R., Stoll, P., Skowronek A. and Tentori, D. (2023). Global value chains: Potential synergies between external trade policy and internal economic initiatives to address the strategic dependencies of the EU. European Union, March.
Baldwin, R., & Freeman, R. (2022). Risks and global supply chains: What we know and what we need to know. Annual Review of Economics, 14, 153-180.
Bauer, M. and Erixon, F., (2020) Europe’s Quest for Technology Sovereignty: Opportunities and Pitfalls. https://ecipe.org/publications/europes-technology-sovereignty/
Bontadini, F., Meliciani, V., Savona, M., Wirkierman, A (2022), Nearshoring and Farsharing in Europe within the global economy, CESifo, Munich, 2022 EconPol Forum 23 (5), 37-42. 
Bontadini, F., Meliciani, V., Savona, M., Urbani, R., Wirkierman, A. (2023) European and Italian strategic dependencies for the twin transition: strengthening trade relationships with Africa, Luiss Institute for European Analysis and Policy, Policy Brief n. 13/23.
Bontadini, F., Evangelista, R., Meliciani, V. and Savona, M. (2024). Technology, global value chains and functional specialisation in Europe. Research Policy, 53(2), 104908.
Capponi, A., Du, C. and Stiglitz, J. E. (2024). “Are Supply Networks Efficiently Resilient?” NBER Working Paper No. 32221, March.
Caravella, S., Crespi, F., Cucignatto, G., & Guarascio, D. (2024). Technological sovereignty and strategic dependencies: The case of the photovoltaic supply chain. Journal of Cleaner Production, 434, 140222.
Celi, G., Guarascio, D. and Simonazzi, A. (2020). A fragile and divided European Union meets Covid-19: further disintegration or ‘Hamiltonian moment’?. Journal of Industrial and Business Economics, 47(3), 411-424.
Celi, G., Guarascio, D., Reljic, J., Simonazzi, A. and Zezza, F. (2022). The Asymmetric Impact of War: Resilience, Vulnerability and Implications for EU Policy. Intereconomics, 57(3), 141-147
Coveri, A. and Zanfei, A. (2022). Functional division of labour and value capture in global value chains: A new empirical assessment based on FDI data. Review of International Political Economy. DOI: 10.1080/09692290.2022.2152074
Coveri, A. and Zanfei, A. (2023). The virtues and limits of specialization in global value chains: Analysis and policy implications. Journal of Industrial and Business Economics, 50(1): 73–90.
Crespi, F., Caravella, S., Menghini, M., Salvatori, C., 2021. European Technological Sovereignty: An Emerging Framework for Policy Strategy. Intereconomics 56, 348–354. https://doi.org/10.1007/s10272-021-1013-6
Cresti L., Dosi G., Fagiolo G. (2023) Technological interdependencies and employment changes in European industries, Structural Change and Economic Dynamics,  Volume 64, 41-57
Drezner, D. W., Farrell, H., and Newman, A. L. (Eds.). (2021). The uses and abuses of weaponized interdependence. Brookings Institution Press.
Edler, J., Blind, K., Kroll, H., & Schubert, T. (2023). Technology sovereignty as an emerging frame for innovation policy. Defining rationales, ends and means. Research Policy, 52(6), 104765.
EPRS European Parliament Research Service, (2021). Key enabling technologies for Europe’s technological sovereignty. https://doi.org/10.2861/24482
European Commission, (2021). Updating the 2020 New Industrial Strategy: building a stronger single market for Europe’s recovery. Communication from the Commission to the European Parliament, The Council, The European Economic and Social Committee and The Committee of The Regions, Brussels, COM(2021) 350 final
European Commission (2022). EU Strategic Dependencies and Capacity: Second Stage of In-Depth Reviews. Commission Staff Working Document, February. Available at: https://ec.europa.eu/docsroom/documents/48878
Gehringer, A. (2023). Calibrating the EU’s Trade Dependency. Survival, 65(1), 81-96.
Germann, J. (2022). Global rivalries, corporate interests and Germany’s ‘National Industrial Strategy 2030’. Review of International Political Economy, 1-27.
Giammetti, R., Papi, L., Teobaldelli, D. and Ticchi, D. (2020). The Italian value chain in the pandemic: the input–output impact of Covid-19 lockdown. Journal of Industrial and Business Economics, 47(3): 483–497.
Juhász, R., Lane, N. J., & Rodrik, D. (2023). The New Economics of Industrial Policy. NBER Working Paper No. 31538, August.
Mariotti, S. (2022). A warning from the Russian–Ukrainian war: avoiding a future that rhymes with the past. Journal of Industrial and Business Economics, 49(4): 761–782.
Mazzucato, M., & Rodrik, D. (2023). Industrial Policy with Conditionalities: A Taxonomy and Sample Cases. UCL Institute for Innovation and Public Purpose, Working Paper Series (IIPP WP 2023-07). Available at: https://www.ucl.ac.uk/bartlett/public-purpose/wp2023-07
Miroudot, S. (2020). Reshaping the Policy Debate on the Implications of COVID-19 for Global Supply Chains. Journal of International Business Policy, 3(4): 430-442.
Rodrik, D. (2008). “Normalizing industrial policy.” World Bank, Commission on Growth and Development, Working Paper no. 3.
Stöllinger, R. (2021). Testing the Smile Curve: Functional Specialisation and Value Creation in GVCs. Structural Change and Economic Dynamics, 56: 93-116.
Strange, R. (2020). The 2020 Covid-19 pandemic and global value chains. Journal of Industrial and Business Economics, 47(3): 455–465.
Sturm, C. (2022) Between a rock and a hard place: European energy policy and complexity in the wake of the Ukraine war. Journal of Industrial and Business Economics, 49, 835–878 
Timmer, M. P., Miroudot, S., & de Vries, G. J. (2019). Functional specialisation in trade. Journal of Economic Geography, 19(1), 1-30.
Weber I.M., Simone G., Pianta M., Waddams C., Gros D.Tackling the European Energy Crisiis, Intereconomics, 1, 4

The SI is linked to:

• Jean Monnet Centre of Excellence on European Inclusive Open Strategic Autonomy EU-IOSAC at the Luiss Institute for European Analysis and Policy (LEAP) organizes a Workshop on Global Vlaue Chains in Europe in cooperation with the Centro Rossi Doria, University Romatre, to be held in Luiss the 7th of June 2024.
• SIEPI (Italian Society of Industrial Economics and Policy) annual workshop to be held the 13-14 June 2024 at the University of Bergamo.
• The annual Conference of the Italian Economic Association to be held on the 24-26 October 2024 at the Carlo Bo University of Urbino.

Participants in these events who will be proposing contributions in line with the topics covered by the SI are encouraged to consider submitting their articles.

Timeline

July 31^st 2024 – deadline for paper submission 

March 2025 – latest date for online first publication of papers accepted for the Special Issue

Submissions will be considered based on a first in – first served rule. Successful papers will be immediately published online and will thereafter be selected for inclusion in the Special Issue to be published in the first semester of 2025. Authors will have to submit their manuscript at https://www.editorialmanager.com/jibe/default1.aspx (this opens in a new tab) and select “S.I.: European competitiveness” during the submission process. Submission guidelines at https://www.springer.com/journal/40812/submission-guidelines (this opens in a new tab).