Conventional wisdom often suggests that technological breakthroughs proliferate in an environment of free markets, free speech, and democracy. In short, if you want to innovate, you need to operate like the United States. But over the past twenty years, China has transformed from a technological backwater into an innovation powerhouse.

Today, China directly competes with the United States on key emerging technologies, such as artificial intelligence and quantum computing. And it has managed to accomplish this feat even as its government has tightened controls on markets, speech, and politics.

Matt Sheehan
Matt Sheehan is a fellow at the Carnegie Endowment for International Peace, where his research focuses on global technology issues, with a specialization in China’s artificial intelligence ecosystem.
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In this video, I argue that three main factors have turbocharged China’s rise as a technological powerhouse: a large, semi-protected market; ties with researchers and companies around the world; and waves of financial, human, and physical capital invested in promising fields like AI. To keep the United States competitive, Washington should explore certain elements of China’s strategy, including a willingness to experiment with pro-innovation policies and an ability to accept a certain amount of “waste” when catalyzing technological upgrading.

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