More generally, the tools used by governments have included erecting barriers to entry, offering tax breaks so that private firms can generate larger profits and use their retained earnings to fund investment, encouraging close ties between banks and favored firms so that the former lend abundantly (and cheaply) to the latter, providing raw materials at a subsidized price, and imposing tariffs so that foreign competition is not a threat. With subsidies and protection from the government, some favored champions have grown rapidly and profitably, acquiring
Summary of the relationship/managed capitalist model. China seems to be doing this well, by virtue of selecting an industry as part of five year plan, other industries (in particular financial) react with knowledge that the blessed industry will flourish, paving the way for cheap credit, success etc. on top of any direct assistance the government gives. (China thought is mine, in case it's incorrect, inapt)
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