Same pressures, different paths: external economic competition, intra-commission politics, and the institutionalisation of IPCEIs in EU industrial policy

Despite facing similar external economic pressures in the 1980s and 2010s – from Japan and the United States earlier and from China and the US more recently – the European Union (EU) institutionalised Important Projects of Common European Interest (IPCEIs) as a central industrial policy instrument only in the 2010s. In the 1980s, while Member States expressed interest in greater use of IPCEIs, the European Commission developed limited internal guidelines, resisting broader institutionalisation By contrast, the 2010s witnessed the Commission actively guiding Member States to use IPCEIs through a dedicated Communication, enhanced legal certainty, increased aid intensities and systemic promotion of strategic value chains, transforming them into a cornerstone of EU industrial policy. Why did comparable external pressures produce divergent outcomes? Building on the special issue's ‘outside-in’ framework, we examine how external pressures interact with internal institutional conditions. Two conditions enabled IPCEI institutionalisation in the 2010s but were absent in the 1980s: (1) the EU state aid regime had achieved a substantial degree of maturity, and (2) DG Competition's evaluative approach to state aid had shifted from a legalistic to an economics-based one. Our findings show that external pressures, while necessary catalysts, remain insufficient without appropriate internal institutional conditions for European integration.