Towards an industrial policy for Scotland: A discussion of principles and approaches

Overview —

This report proposes a mutual, sectoral model of industrial development and rejects both ‘top down planning’ and ‘free market’ approaches.

Our approach is based on the recognition that the economy is not a force ‘external’ to society, governed by its own set of abstract rules or laws. The form an economy takes is inevitably the result of political decision-making.

Democracy must therefore extend to the economic sphere to ensure that the outcomes of these political decisions are aligned with the aspirations of the people.


Iain Cairns, Prof Andrew Cumbers

Prof Mike Danson, Prof Iain Docherty

Pat Kane, Gordon Morgan

Robin McAlpine, Prof Robert McMaster

Willie Sullivan, Prof Geoffrey Whittam


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An industrial policy cannot be a centralised, top-down plan for an entire economy written by theorists. An effective industrial policy can only be produced sector by sector, industry by industry, and must be based on all the talent that can be assembled. Nonetheless, some broad guidelines and principles can be established.

This paper investigates and proposes such guidelines and principles. In doing so it seeks directly to challenge the orthodoxy that central management of a small number of economic ‘levers’ will ever maximise the potential of the economy.

It rejects any simplistic measure of what economic success looks like, noting that in recent times the preferred model of economic growth has in many cases impacted negatively on society, prosperity and the environment.


― An industrial policy begins from the view that the economy is not in some way separate from wider society or its hopes and aspirations. The prevailing view that the economy must be protected, isolated and immunised from democracy must be challenged if we wish to create an economy that works for citizens.

― A sectoral approach is required to promote an ‘interconnected economy’, in which different sectors ‘grow up together’. A good motto for this kind of industrial policy could be
‘no sector left behind’.

― Sector associations (such as those in the Nordic countries) are institutions which enable all the main players in an industry sector to work collectively to come up with common solutions to develop their sector for the benefit of all.

― It is important to be aware that Scotland simply does not have access to the economic policy tools that it would require to pursue a substantially different economic strategy. Most macroeconomic, regulatory, employment, social security, tax, immigration and trade powers remain reserved to Westminster and these will continue to be directed towards the wrong economic approaches until independence or such time as those tools are otherwise delivered.

― However, there remains a substantial range of actions which can be taken in Scotland to help induce the right kind of economic transformation and these can be assembled into a ‘toolkit’ of powers which sector associations can draw on in developing their proposals.

― A Common Weal economy actively encourages democratic experimentation with the structure of enterprises and sectors, including open source and ‘peer production’ business methods. Such an approach would be greatly aided by a news media industry that more effectively supports the generation, availability and circulation of new economic ideas.

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