Choi, Chong JuBerger, Ron2019-09-252019-09-252012-11-182011-03http://hdl.handle.net/20.500.12424/188305The bankruptcy and merger of three major American investment banks, Bear Stearns, Lehmann Brothers, and Merrill Lynch, in 2008 have shocked the United States government to undertake dramatic market intervention and a $700 billion U.S. dollar bailout that resembles ―industrial policy‖ in many other countries. Many global policymakers have discussed the end of laissez faire capitalism in the 21st century; others will blame investment bankers and financial institutions for their greed and lack of ethics as the root causes of the first global financial crisis of the 21st century. Critics of market intervention, often called industrial policy in many countries, point out to two potential weaknesses: governments may have less knowledge than markets on how to pick winners, and industrial policy creates possibilities of corruption and rent seeking. Our conceptual paper introduces the idea that industrial policy helps to overcome three key aspects of ―institutional infrastructure‖ in all countries of the world. These three institutional infrastructures are financial, knowledge, and physical.engWith permission of the license/copyright holderCapitalismcorporate governanceinstitutionsindustrial policysocial learninginstitutional infrastructionEconomic ethicsEthics of economic systemsArticle