Faculty Research Forum - How the US-China Tech War Shapes State-Business Alignment

The weaponization of supply chains has become an essential method of statecraft and economic coercion, especially between rising and declining powers. Conventional wisdom assumes that businesses will comply with the state’s agenda. This talk challenges such a state-centric approach and investigates how the international structure shapes state-business alignment within the dominating and rising economies. Depending on the higher or lower positions that firms occupy on global value chains, firms’ interest in maximizing absolute gains diverges from, or converges with, the states’ interest in maximizing relative gains. While there are other historical examples, this talk focuses on the compatibility of state and business interests in the United States and China before and after the “tech war,” when the U.S. weaponized the semiconductor supply chains. It also explores changing dynamics of state-business relations in China over the past three decades, explaining how authoritarian capitalism complicated both the tech sector development and the prospects of the tech war.