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4 - Constructing a Chinese AI Global Supply Chain in the Shadow of “Great Power Competition”

from Part I - Global Supply Chains, Geopolitics, and Trade Wars

Published online by Cambridge University Press:  07 May 2021

By
Victor Shih
Edited by
Etel Solingen
Etel Solingen
Affiliation:
University of California, Irvine
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Summary

In 2017, the Chinese Communist Party began to pay close attention to the development of China’s artificial intelligence (AI) industry, likely motivated by rising tension between the USA and China. This chapter documents the suite of policies that followed and their impact on the evolution of the AI industry in China. First, the AI industry has become another policy tool for the ruling Chinese Communist Party, especially during national emergencies. Second, the AI push likely will further encourage vertical integration of the AI value chain, especially for lead firms. Third, rather than foster market or modular transactions along the AI value chain, Chinese government subsidies and preference for national champions will foster relational and even captive ties between actors along the AI value chain. Ironically, these policies may encourage fragmentation of data architecture in China instead of consolidation.

Keywords

Artificial intelligenceChinaChinese Communist PartyIndustrial policyPolitical economyAuthoritarian politicsProtectionismSubsidiesValue chain
Type
Chapter
Information
Geopolitics, Supply Chains, and International Relations in East Asia , pp. 60 - 76
Publisher: Cambridge University Press
Print publication year: 2021

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