The Industrial Champion: A Historical Perspective on a Competition Model in the French Industry

In this paper, I aim at analyzing in depth a structural strategy pursued by the French government from the 1970s on. Under Pompidou’s presidency, the administration devised a strategy aimed at adapting French firms to international competition. This strategy became the backbone of the State’s strategy vis-à-vis French incumbents (be they former or present state-owned companies). The national champion strategy consists in helping a leading firm becoming a global player with the full help of the State. In this paper, I show where this strategy comes from and explain its diffusion across sectors, taking the example of the energy industry. The industrial champion model has been deployed by French high civil servants close both to the industry and advisors to ministers in the 1960s. They legitimated a concern industrial economists had about concentration and size. In short, these economists thought that size had many advantages that French firms were too small to capture. This model led to a wave of mergers in the 1970s. The last part of the paper explores the reasons of the delay in the energy industry in which mergers occurred at the beginning of the 2000s.