View source for Dirigisme

{{short description|Economic doctrine in which the state plays a strong directory role}}
{{More citations needed|date=September 2025}}
{{economic systems sidebar|by coordination}}
{{Capitalism sidebar|systems}}
{{italic title}}

'''''Dirigisme''''' ({{IPA|fr|diʁiʒism|lang}}), or '''''dirigism''''' ({{ety|fr|diriger|to direct}}), refers to an economic system in which the [[State (polity)|state]] takes an active and directive role in shaping and guiding the economy, rather than limiting itself to a purely [[Regulation|regulatory]] or hands-off approach within a [[market economy]]. As an economic doctrine, ''dirigisme'' stands in contrast to ''[[laissez-faire]]'', highlighting the constructive role of [[market intervention]] in addressing inefficiencies and [[market failure]]s. ''Dirigiste'' policies typically include [[indicative planning]], state-guided investment, and the strategic use of market instruments such as taxes and subsidies to encourage economic actors to align with national development goals.<ref>[https://web.archive.org/web/20131104185227/http://www.oxforddictionaries.com/us/definition/american_english/dirigisme "Dirigisme"]. ''Oxford Dictionaries''. Retrieved 25 May 2013.</ref> Dirigisme is not synonymous with a [[Soviet-type economic planning|state-controlled command economy]] but a market economy and big public sector is required for dirigisme; hence the public sector becomes an instrument for altering the market.

The term emerged in the [[post–World War II]] era to describe the economic policies of [[France]] which included substantial state-directed investment, the use of indicative [[economic planning]] to supplement the [[market mechanism]] and the establishment of [[state enterprise]]s in strategic domestic sectors. It coincided with both the period of substantial [[economic]] and [[demographic]] growth, known as the [[Trente Glorieuses]] which followed the war, and the slowdown beginning with the [[1973 oil crisis]].

The term has subsequently been used to classify other economies that pursued similar policies, such as [[Japan]], the [[Four Asian Tigers|East Asian tiger economies]] of [[Hong Kong]], [[Singapore]], [[South Korea]] and [[Taiwan]]; the [[Economy of China|economy]] of [[China]] after its [[Chinese economic reform|economic reforms]],<ref name="Models of dirigisme in East Asia: perspectives from Eastern Europe, 1996">{{cite book |doi=10.1007/978-1-349-14155-5_13 |chapter=Models of Dirigisme in East Asia: Perspectives for Eastern Europe |title=The Aftermath of 'Real Existing Socialism' in Eastern Europe |year=1996 |last1=Schmidt |first1=Johannes Dragsbaek |pages=196–216 |isbn=978-1-349-14157-9 }}</ref> [[Indonesia]]<ref>{{cite journal | url=https://journal.binus.ac.id/index.php/jas/article/view/9075 | doi=10.21512/jas.v10i2.9075 | title=Key Features of Indonesia's State Capitalism Under Jokowi | date=2023 | last1=Kim | first1=Kyunghoon | journal=Jas (Journal of Asean Studies) | volume=10 | issue=2 | doi-access=free }}</ref><ref>{{cite journal | url=https://www.tandfonline.com/doi/full/10.1080/00472336.2019.1675084 | doi=10.1080/00472336.2019.1675084 | title=Indonesia's Restrained State Capitalism: Development and Policy Challenges | date=2021 | last1=Kim | first1=Kyunghoon | journal=Journal of Contemporary Asia | volume=51 | issue=3 | pages=419–446 | s2cid=211395480 | url-access=subscription }}</ref> and [[India]] after the [[open economy|opening of its economy]] in 1991.<ref>{{Citation |last=Chandrasekhar |first=C. P. |title=From Dirigisme to Neoliberalism: Aspects of the Political Economy of the Transition in India |date=2012 |work=Developmental Politics in Transition |pages=140–165 |editor-last=Kyung-Sup |editor-first=Chang |url=https://link.springer.com/10.1057/9781137028303_8 |access-date=2025-03-07 |place=London |publisher=Palgrave Macmillan UK |language=en |doi=10.1057/9781137028303_8 |isbn=978-1-349-33332-5 |editor2-last=Fine |editor2-first=Ben |editor3-last=Weiss |editor3-first=Linda|url-access=subscription }}</ref><ref>{{Citation |last=Mazumdar |first=Surajit |title=Big business and economic nationalism in India |date=2012-06-28 |work=Globalization and Economic Nationalism in Asia |pages=59–83 |url=https://doi.org/10.1093/acprof:oso/9780199646210.003.0003 |access-date=2025-03-07 |publisher=Oxford University Press|doi=10.1093/acprof:oso/9780199646210.003.0003 |isbn=978-0-19-964621-0 |url-access=subscription }}</ref><ref>{{cite journal | url=https://onlinelibrary.wiley.com/doi/epdf/10.1111/dech.12579 | doi=10.1111/dech.12579 | title=New Developmentalism and its Discontents: State Activism in Modi's Gujarat and India | year=2022 | last1=Chatterjee | first1=Elizabeth | journal=Development and Change | volume=53 | pages=58–83 | s2cid=212790073 | url-access=subscription }}</ref> Outcomes associated with ''dirigisme'' differ across these cases, with some economies achieving sustained growth and structural transformation, while others recorded more limited or uneven results. ''Dirigisme'' is not strictly tied to any single political ideology or philosophy, as variations of dirigiste policy have been implemented under both left and right leaning governments.

According to the heterodox economist [[Mariana Mazzucato]], most modern economies of the world can be characterized as ''dirigiste'' to some degree as the state may exercise directive action by performing or subsidizing research and development of new technologies through government procurement (especially [[military]]) or through state-run research institutes.<ref>{{cite news |last1=Mazzucato |first1=Mariana |title=The myth of the 'meddling' state |url=https://www.publicfinancefocus.org/news/2013/06/myth-meddling-state |work=Public Finance Focus |date=25 June 2013 }}</ref>

== France ==
{{more citations needed section|date=May 2013}}
{{Conservatism in France}}
Before the [[Second World War]], France had a relatively fragmented [[capitalism|capitalist]] economic system. The many small companies, often family-owned, were often not dynamic and efficient{{Citation needed|date=November 2008}} in comparison to the large industrial groups in [[Germany]] or the [[United States]]. The Second World War laid waste to France. Railroads and industries were destroyed by aerial [[bombardment]] and [[sabotage]]; industries were seized by Nazi Germany; in the immediate postwar years loomed the spectre of long years of [[rationing]] (such as the system enforced in that period in the [[United Kingdom]]). Some sections of the French business and political world lost authority after [[Vichy France|collaborating with the German occupiers]].

Post-war French governments, from whichever political side, generally sought rational, efficient economic development, with the long-term goal of matching the highly developed and technologically advanced economy of the [[United States]]. The development of French ''dirigisme'' coincided with the development of [[meritocracy|meritocratic]] [[Technocracy (bureaucratic)|technocracy]]: the [[École Nationale d'Administration]] supplied the state with high-level administrators, while leadership positions in industry were staffed with [[Corps of Mines (France)|Corps of Mines]] state engineers and other personnel trained at the [[École Polytechnique]].

During the 1945–1975 period, France experienced unprecedented [[economic growth]] (5.1% on average) and a [[demography|demographic]] boom, leading to the coinage of the term ''[[Trente Glorieuses]]'' (the "Glorious Thirty [years]").

''Dirigisme'' flourished under the conservative governments of [[Charles de Gaulle]] and [[Georges Pompidou]]. In those times, the policy was viewed as a middle way between the American policy of little state involvement and the Soviet policy of total state control. In 1981, [[French Socialist Party|Socialist]] president [[François Mitterrand]] was elected, promising greater [[state enterprise]] in the economy; his government soon [[nationalization|nationalised]] industries and banks. However, in 1983 the initial bad economic results forced the government to renounce ''dirigisme'' and start the era of ''rigueur'' ("rigour"). This was primarily due to the Inflation of the French [[Franc]] and the [[Keynesian]] policies taken by [[François Mitterrand]]. ''Dirigisme'' has remained out of favour with subsequent governments, though some of its traits remain.

=== Indicative planning ===
The main French tool under ''dirigisme'' was [[indicative planning]] through plans designed by the ''Commissariat général du plan'' ("Commission for the Plan"). Indicative planning used various incentives to induce public and private actors to behave in an optimal fashion, with the plan serving as a general guideline for optimal investment. During this period France never ceased to be a capitalist economy directed by the [[accumulation of capital]], profit-maximizing enterprise and [[Market economy|market-based allocation]] of producer goods.

In contrast to [[Soviet-type economic planning|Soviet-type central planning]] practiced in the former [[Eastern bloc|Soviet bloc]], where economic planning substituted private [[profit (accounting)|profit]] incentivized investment and operated the factors of production according to a binding plan, the French state never owned more than a minority of industry and did not seek to replace private profit with central planning. The idea of ''dirigisme'' is to complement and improve the efficiency of the market through indirect planning intended to provide better information to market participants. This concept is held in contrast to a planned economy, which aims to replace market-based allocation of production and investment with a binding plan of production expressed in units of physical quantities.

=== State ownership ===
Because French industry prior to the Second World War was weak due to fragmentation, the French government encouraged mergers and the formation of "[[national champions]]": large industry groups backed by the state.

Two areas where the French government sought greater control were in [[infrastructure]] and the transportation system. The French government owned the national railway company [[SNCF]], the national electricity utility [[Electricité de France|EDF]], the national natural gas utility [[Gaz de France|GDF]], the national airline [[Air France]]; [[France Télécom|phone]] and [[La Poste (France)|postal]] services were operated as the [[Postes, télégraphes et téléphones (France)|PTT]] administration. The government chose to devolve the construction of most [[autoroutes of France|autoroutes]] (freeways) to semi-private companies rather than to administer them itself. Other areas where the French government directly intervened were defence, nuclear and aerospace industries ([[Aérospatiale]]).

This development was marked by ''volontarisme'', the belief that difficulties (e.g. postwar devastation, lack of natural resources) could be overcome through willpower and ingenuity. For instance, following the [[1973 energy crisis]], the saying "In France we don't have oil, but we have ideas" was coined. Volontarisme emphasized [[modernization]], resulting in a variety of ambitious state plans. Examples of this trend include the extensive use of [[nuclear power|nuclear energy]] (close to 80% of French electrical consumption), the [[Minitel]], an early online system for the masses, and the [[TGV]], a [[high-speed rail]] network.

== India ==
{{See also|Hindu rate of growth}}
[[Soviet-type economic planning]] is seen in [[India]] after the end of [[British rule]] from 1947 with domestic policy tending towards protectionism, a strong emphasis on [[import substitution industrialisation]], [[economic interventionism]], [[Regulation (socio-legal concept)|business regulation]] and [[central planning]],<ref>{{Harvnb|Panagariya|2008|pp=31–32}}</ref> trade, and a large government-run [[public sector]]. Foreign investment policies were highly restricted via the [[Licence Raj]].<ref>{{Harvnb|Panagariya|2008|p=24}}</ref> However, in regard to trade and foreign investment, other authors disagree stating that high tariff barriers were maintained, with import duties of 350% not being uncommon,<ref name=":0">{{Harvnb|Tharoor|2003|p=242}}</ref> and there was also severe restrictions on the entry of foreign goods, capital, and technology.<ref name=":0" /> Although a mixed economy, the share of investment in public sector enterprises was 60%.<ref name="Sharma & Dhindsa">{{Harvnb|Sharma|Dhindsa|2005|p=xxv}}</ref> India's economic policies during this period were more akin to [[Soviet-type economic planning|Soviet economic planning]] rather than the French ''dirigisme'' model.<ref name="Sharma & Dhindsa"></ref> ''[[Socialism|Socialist]]'' economic [[Economic planning|planning]], was especially prevalent in the form of the Licence Raj the [[Planning Commission (India)|Planning Commission]] and [[Five-Year Plans of India|Five-Year plans]].<ref name=":1">{{Cite book|last=Chandrasekhar|first=C. P.|chapter=From Dirigisme to Neoliberalism: Aspects of the Political Economy of the Transition in India|date=2012|chapter-url=https://doi.org/10.1057/9781137028303_8|title=Developmental Politics in Transition: The Neoliberal Era and Beyond|pages=140–165|editor-first=Kyung-Sup|editor-last=Chang|series=International Political Economy Series|place=London|publisher=Palgrave Macmillan UK|language=en|doi=10.1057/9781137028303_8|isbn=978-1-137-02830-3|access-date=2020-09-04|editor2-last=Fine|editor2-first=Ben|editor3-last=Weiss|editor3-first=Linda}}</ref><ref name=":2">{{Cite web|last=Mazumdar|first=Surajit|date=2012|title=Industrialization, Dirigisme and Capitalists: Indian Big Business from Independence to Liberalization|url=https://mpra.ub.uni-muenchen.de/93158/|access-date=2020-09-04|website=mpra.ub.uni-muenchen.de|language=en}}</ref>   

After [[Economic liberalisation in India|liberalisation]] in 1991, India shifted from a Mixed [[Five-year plans of the Soviet Union|planned]] led type model (very similar to the Soviet economy) to Mixed market ''dirigisme'' economy.<ref name="FP">{{cite news|last1=Babones|first1=Salvatore|date=27 July 2011|title=Why France Has a Much Better India Strategy Than America|work=FP|url=https://foreignpolicy.com/2021/02/01/france-india-better-strategy-than-america/}}</ref><ref name="GOVERNANCENOW">{{cite news|last1=Srivastava|first1=Pankaj|date=27 July 2011|title=I believe the neoliberal regime is also reaching a dead end: Prabhat Patnaik|work=GOVERNANCENOW|url=https://www.governancenow.com/views/interview/i-believe-the-neoliberal-regime-also-reaching-a-dead-end-prabhat-patnaik}}</ref> The Indian state has complete control and ownership of [[Indian Railways|railways]], [[National Highways and Infrastructure Development Corporation Limited|highways]]; majority control and stake in [[Banking in India|banking]],<ref name="factual">{{cite news|last1=D'Silva|first1=Jeetha|date=1 September 2007|title=India growth story is attracting talent from govt establishments|work=Livemint|url=https://www.livemint.com/Politics/GUwpS0jLvF7TpC1inGLCyN/India-growth-story-is-attracting-talent-from-govt-establishm.html}}</ref> [[Insurance in India|insurance]],<ref name="test">{{cite news|last1=Sikarwar|first1=Deepshikha|date=27 July 2011|title=Sovereign guarantee for all policies issued by LIC will continue|work=The Economic Times|url=https://economictimes.indiatimes.com/wealth/personal-finance-news/sovereign-guarantee-for-all-policies-issued-by-lic-will-continue/articleshow/9378117.cms}}</ref> [[Agricultural produce market committee|farming]],<ref name="farm">{{cite news|last1=Nirmal|first1=Rajalakshmi|date=27 July 2021|title=Ending APMC monopoly: Centre bites the bullet at last|work=The Hindu|url=https://www.thehindubusinessline.com/economy/agri-business/ending-apmc-monopoly-centre-bites-the-bullet-at-last/article31595721.ece}}</ref> [[Operation Flood|dairy]], fertilizers & chemicals,<ref name="chem">{{cite news|last1=Fernández|first1=Lucía |date=27 July 2021|title=Leading fertilizer companies in India as of February 2021, based on net sales|work=statista|url=https://www.statista.com/statistics/949842/india-leading-fertilizer-companies-based-on-net-sales/}}</ref> [[List of airports in India|airports]],<ref name="aai">{{cite news |date=27 July 2021|title=New Cargo Agency To End Aai Monopoly|newspaper=[[Business Standard]]|url=https://www.business-standard.com/article/economy-policy/new-cargo-agency-to-end-aai-monopoly-198102801055_1.html }}</ref> [[Nuclear power in India|nuclear]], mining, [[National Payments Corporation of India|digitization]], [[Defence industry of India#State-run|defense]], [[Iron and steel industry in India|steel]], rare earths, water, electricity, oil and gas industries and power plants,<ref name="EnergyStats2016">{{cite web|title=Energy Statistics 2017|url=http://www.mospi.nic.in/sites/default/files/publication_reports/Energy_Statistics_2017r.pdf.pdf|publisher=[[Ministry of Statistics and Programme Implementation]]}}</ref> and has substantial control over [[Digital India|digitalization]], [[Bharat Broadband Network|Broadband as national infrastructure]], [[List of telecom companies in India#Telecom R&D firms|telecommunication]], [[Centre for Development of Advanced Computing|supercomputing]], [[Antrix Corporation|space]], [[Sagar Mala project|port and shipping industries]],<ref name="SCIabout">{{cite web|title=About Us|url=http://www.shipindia.com/newsite/DisplayContent.asp?CategoryID=1&ContentID=1|archive-url=https://web.archive.org/web/20071106162636/http://www.shipindia.com/newsite/DisplayContent.asp?CategoryID=1&ContentID=1|archive-date=6 November 2007|access-date=3 June 2009|work=Official webpage of the Shipping Corporation of India}}</ref> among other industries, were effectively nationalised in the mid-1950s.<ref name="staley">{{cite magazine|last=Staley|first=Sam|year=2006|title=The Rise and Fall of Indian Socialism: Why India embraced economic reform|url=https://www.reason.com/news/show/36682.html|magazine=[[Reason (magazine)|Reason]]|archive-url=https://web.archive.org/web/20090114053740/http://reason.com/news/show/36682.html|archive-date=14 January 2009|access-date=17 January 2011|url-status=dead}}</ref><ref name=":1" /><ref name=":2" /> In essence, the Indian Government has indirect control on all sectors except technology and consumer goods.

== Other economies with ''dirigiste'' characteristics ==
Economic ''dirigisme'' has been described as an inherent aspect of [[fascist]] economies by Hungarian author [[Iván T. Berend]] in his book ''An Economic History of Twentieth-Century Europe''.<ref>{{cite book |last1=Berend |first1=Ivan T. |author-link1=Iván T. Berend |title=An Economic History of Twentieth-Century Europe: Economic Regimes from Laissez-Faire to Globalization |url=https://archive.org/details/economichistoryt00bere |url-access=limited |date=2006 |publisher=Cambridge University Press |isbn=978-1-139-45264-9 |page=[https://archive.org/details/economichistoryt00bere/page/n110 93] }}</ref> However, the fascist systems created in [[Fascist Italy (1922–1943)|Italy]], [[Estado Novo (Portugal)|Portugal]], [[Francoist Spain|Spain]], [[Empire of Japan|Japan]], or [[Nazi Germany|Germany]] were a varied mix of elements from numerous philosophies, including [[nationalism]], [[authoritarianism]], [[militarism]], [[corporatism]], [[Collectivism and individualism|collectivism]], [[totalitarianism]], and [[anti-communism]].<ref>{{cite journal |last1=Baker |first1=David |title=The political economy of fascism: Myth ''or'' reality, or myth ''and'' reality? |journal=New Political Economy |date=June 2006 |volume=11 |issue=2 |pages=227–250 |doi=10.1080/13563460600655581 |s2cid=155046186 }}</ref>

''Dirigisme'' has been brought up as a politico-economic scheme at odds with ''laissez-faire'' capitalism in the context of French overseas holdings. To varying degrees throughout the post-colonial period, countries such as Lebanon and Syria have been influenced by this motif.<ref>{{cite news |last1=Quilty |first1=Jim |title=Cohabitation leading to a shotgun wedding and a bitter divorce |url=https://www.dailystar.com.lb//Culture/Art/2007/Oct-17/116065-cohabitation-leading-to-a-shotgun-wedding-and-a-bitter-divorce.ashx |archive-url=https://web.archive.org/web/20200730010723/https://www.dailystar.com.lb//Culture/Art/2007/Oct-17/116065-cohabitation-leading-to-a-shotgun-wedding-and-a-bitter-divorce.ashx |url-status=dead |archive-date=July 30, 2020 |work=The Daily Star |date=October 17, 2007 }}</ref>

== See also ==
* [[Colbertism]]
* [[Crony capitalism]]
* [[Developmental state]]
* [[Economic planning]]
* [[French Fourth Republic]] (1946–1958)
* [[Indicative planning]]
* [[Industrial policy]]
* [[Mercantilism]]
* [[Mixed economy]]
* [[State capitalism]]
* [[State-owned enterprise]]
* [[State-sponsored capitalism]]

=== Economies with dirigisme or similar policies ===
* [[American School (economics)|American School]] (1790s–1970s), the American model
* [[Beijing Consensus]], the Chinese model
* [[Economy of France]] (1945–1975), often known as [[Trente Glorieuses]] 
* [[Economy of Singapore]]
* [[Economy of Taiwan]]
* [[Four Asian Tigers]]
* [[Economy of Indonesia]]
* [[German model]], the German post-war economic model
* [[Economy of Japan]]
** [[Japanese economic miracle]]
* [[National Policy]] (1876–1920), the Canadian model
* [[Economy of South Africa]] (1948–1994)

== References ==
{{reflist|2}}

== Further reading ==
* {{cite book|last=Cohen|first=Élie|title=Le Colbertisme "high tech" : économie des Telecom et du Grand Projet|year=1992|publisher=Hachette|location=Paris|isbn=2-01-019343-1}}
* {{cite book|title=Economic Reform and Development|last1=Sharma|first1=Anju|last2=Dhindsa|first2=K. S.|year=2005|publisher=Concept Publishing Company|isbn=978-8-180-69273-4}}
* {{cite book |last=Panagariya |first=Arvind |author-link=Arvind Panagariya |title=India: The Emerging Giant |url=https://www.google.com/books/edition/India/iQIoaA4sWxAC?hl=en&gbpv=0|url-access=limited |publisher=Oxford University Press |year=2008 |isbn=978-0-19-531503-5 |page=[https://archive.org/details/indiaemerginggia00pana_483/page/n544 514]}}
* {{cite book|title=Nehru The Invention of India|last=Tharoor|first=Shashi|year=2003|publisher=Arcade Pub.|isbn=978-1-559-70737-4}}

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