Acton Line

The last time you took a commercial airline flight, odds are that you were on a plane that was manufactured by one of two companies: American-based Boeing, or French-based Airbus. Together, these two companies have almost the entire market for commercial airplanes. A piece published recently at the website American Compass makes the argument that Airbus is a success story for industrial policy: European government decided they needed to compete with foreign manufacturers of airplanes, they made the public-money backed investments, and propelled Airbus past Boeing and others to be the world leader. As American Compass said when publishing the piece: “According to free-market dogma, state-backed Airbus shouldn't have been able to compete with Boeing. Instead, Airbus surpassed Boeing as leading aircraft manufacturer, gaining a reputation for cutting-edge innovation. U.S. policymakers should take note.” The American Compass piece really took off. But is really describing reality for Airbus and Boeing? Economist a