The New EU Industrial Policy and Deepening Structural Asymmetries: Smart Specialisation Not So Smart

In response to the 2008 financial crisis and rising competitive pressures from emerging markets, EU industrial policy has made a major comeback. One of the flagship policies is Smart Specialisation, which is located at the intersection of industrial and cohesion policy, and which serves the twin purpose of catalysing the transition of manufacturing sectors to innovative Industry 4.0-type technologies, as well as inducing social and territorial cohesion and upward economic convergence. Employing a critical political economy perspective that accounts for the interplay between state regulation and capitalism's general dynamic of uneven and combined development, the article argues that Smart Specialisation is unlikely to lead to the proclaimed and much-needed economic intra-EU convergence. Although individual Smart Specialisation projects undoubtedly can lead to a technological upgrading, narrowing the gap between advanced high-tech regions and rapidly de-industrializing regions, or regions locked into labour-intensive, low value-added and less knowledge-intensive production, remains a pipedream.