International Organization


Management of industrial surplus capacity in the European Community

Loukas Tsoukalisa1 and António da Silva Ferreiraa2

a1 Research Fellow in European Studies at St. Catherine's College, Oxford, and editor of the Journal of Common Market Studies.

a2 member of the research group at St. Catherine's College, Oxford, working on the project “The Second Round of Enlargement of the European Community.”

In a recent article for this journal, Susan Strange analyzed the political consequences of surplus capacity in three industrial sectors: steel, textiles, and shipbuilding. As she has shown, the emergence of serious problems of surplus capacity has accelerated protectionist trends in governmental policy in Europe and North America. The rhetoric of liberalism now is frequently accompanied by the reality of quotas, cartel agreements, subsidies for domestic firms, and discrimination against particularly dynamic producers.