This article was featured in the Harvard Business Review, a general management magazine. Scholars Henry Farrell and Abraham Newman of the U.S.-China Research Group on E-commerce and Mobile Technology published this article as part of their collaborative research.
Author: Henry Farrell Abraham Newman
To keep the global economy working smoothly, crucial resources such as money, information, and components pass through an intricate system of conduits. But while this critical invisible infrastructure may seem to be decentralized and have multiple redundancies, it has significant choke points. A new political risk comes from powerful, wealthy states—especially the United States—that use legal authority or coercion to turn economic networks into tools of domination, ensnaring businesses in the process. The authors encourage multinational businesses to analyze their exposure to network choke points, noting that lobbying government officials and teaming up with industry peers to resist coercion can mitigate such risks.