Governments actively encouraged the inefficiency of British producers. After the war, the authorities distributed scarce supplies of steel to manufacturers on the basis of their pre-war market share, thus freezing a major sector of the economy in the mould of the past and decisively penalizing new, and potentially more efficient producers. The guarantee of supplies, the artificially high demand for anything they could make, and political pressure to behave in economically inefficient ways all combined to lead British firms down into bankruptcy.
