ABSTRACT
For improving the viability of strategic industry sectors, various policy options are available to government leaders. On economic efficiency grounds, many critics of industrial policy argue that the government efforts would interfere with the free market, which is the best means for assuring efficient resource allocation in production. In the U.K., France, and other European countries, an explicit economic goal is to improve the prospects for domestic arms producers. In such countries as Brazil, Israel, South Korea and Taiwan, even greater emphasis is placed on economic development objectives and enhanced defense capabilities based on arms trade supported by domestic production. The United States passively monitors incoming foreign investments through a Treasury-chaired interdepartmental committee called Committee on Foreign Investment in the US and collects limited statistical data.
