Do We Need National Champions? If so, Do We Need a Champions-Related Industrial Policy? An Evolutionary Perspective

23 Pages Posted: 16 Nov 2007

See all articles by Oliver Falck

Oliver Falck

CESifo (Center for Economic Studies and Ifo Institute) - Department Human Capital and Innovation

Stephan Heblich

University of Stirling - Department of Economics

Date Written: November 12, 2007

Abstract

This paper discusses the role of so-called national champions within the context of the EU's ambitious goal to become the most competitive and dynamic knowledge-based economic region in the world by 2010. We find football to be a useful analogy in our discussion of national champions. There are many different types of football players: veteran performers who are past their prime, young stars who have not yet developed their full potential, fans' darlings, and the actual stars - the key performers. For a team to be consistently successful across time, it needs to maintain the right mix of different types of players, particularly in regard to current and future key performers. What makes a key performer a "real" star is not only extraordinary talent but also, and perhaps even more important, ability to be a team player and inspire others to be the same. Applying this analogy to the economic field, we come to the conclusion that the "real" champions in the business environment serve as network pilots within regional networks. By fostering a dynamic economic environment, they create their own rents, unlike less successful firms who concentrate on unproductive rent seeking and shifting.

Keywords: national champions, industrial policy, evolutionary economics, systems of innovation

JEL Classification: L52, O25, O33, P11

Suggested Citation

Falck, Oliver and Heblich, Stephan, Do We Need National Champions? If so, Do We Need a Champions-Related Industrial Policy? An Evolutionary Perspective (November 12, 2007). Jena Economic Research Paper No. 2007-088. Available at SSRN: https://ssrn.com/abstract=1029668 or http://dx.doi.org/10.2139/ssrn.1029668

Oliver Falck

CESifo (Center for Economic Studies and Ifo Institute) - Department Human Capital and Innovation ( email )

Poschingerstr. 5
Munich, 81679
Germany

Stephan Heblich (Contact Author)

University of Stirling - Department of Economics ( email )

Stirling, Scotland FK9 4LA
United Kingdom

HOME PAGE: http://www.management.stir.ac.uk/people/economics/academic-staff/dr-stephan-heblich

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