Franc et al
In the past, public policy guided the long-term aspect of major public works and development programmes, such as transport infrastructure, energy, aeronautics and space. In return, such projects fed industrial R&D. But recently, the weight of public debt stemming from the financial crisis has diminished the public sphere’s capacity to invest in such projects. Businesses are also investing less in the future, as low growth creates pressure to be competitive on cost.
The issue is becoming systemic because sluggish growth has resulted in a portion of public borrowing being used to cover the economic and social consequences of retrenchment in the private sector. Meanwhile, the economic crisis plays out against the still greater long-term crisis of climate change.