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December 16, 2019

Responding To: Final Insights from the U.S.-China Research Group on E-Commerce and Mobile Technology

It Will Get Worse Before It Gets Better

Adam Segal

Yes, the dialogue is extremely useful. The dialogue has at least three strengths. First, it is one of the few genuinely bilateral discussions that seems to have survived the current political environment. Others that I am aware of (or participated in) have been derailed by lack of counterparts; sense of frustration with quality of discussions; and travel or bureaucratic impediments. Second, the dialogue consistently tries to apply academic work to policy debates, debates which are often dominated by soundbites like “tech cold war” and “decoupling.” Third, and related, the work of several of the scholars involved in the dialogue at the sectoral or firm level provides important insight into what is actually happening on the ground.

People who studied China and tech were really ahead of their time. There is a desperate need for more studies at the sectoral and firm level. Given the demands of research, and the pace of academic publishing, they are however unlikely to be in time to shape the policy debate in the way they should. There is also a need for more historical views. Neither side has a clear view of who the winners and losers of the “tech war” will be, in part because few understand the complexity of supply chains and in part because we don’t know what time frame we are looking at.

It is going to get worse before it gets better, with competition expanding to a larger set of technologies. There will, eventually, be a righting of the relationship, not with Beijing and Washington decoupling, but the two sides reducing vulnerability to each other in a more limited set of technologies.

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