The interplays of US, China and their intellectual monopolies

Please cite the paper as:
Cecilia Rikap and Ariel Slipak, (2020), The interplays of US, China and their intellectual monopolies, World Economics Association (WEA) Conferences, No. 1 2020, Trade Wars after Coronavirus, Economic, political and theoretical implications

Abstract

Beyond the US-China watershed and supposedly polar state ideologies (liberal and pro-free- market in the US and dominated by state planning in China), this article delves into the shared traits of these powerful states. The US -at least since the Second World War- and China since 1978 share a systematic and highly oriented industrial policy directed to spur innovation in chosen sectors. In both cases, policies have been entangled with corporate interests and contribute to explaining the emergence of intellectual monopolies, precisely dominating each state’s privileged industries and technologies. Furthermore, each state’s geopolitical power relies on its respective intellectual monopolies. However, besides the support of each state, intellectual monopolies control global production and innovation networks constituting their own republics, which formally overlap with portions of different states. Intellectual monopolies also minimize their paid taxes while increasing wealth concentration. Contemporary capitalism is always on the brink of a global collapse as core states and intellectual monopolies are simultaneously friends and foes. We end this contribution with a preliminary analysis of these complexities.

2 comment

  • Juan says:

    Hi Cecilia and Ariel,

    Congratulations for the paper. I think it is a very interesting perspective to analyze the current technological warfare. Also, I have found that you have more work that will be very useful to me in studying digital capitalism and the role of both powers.

    Specifically, for me this work is a window to deepen the concept of “intellectual monopolies”, since I do not know it in depth and it can be very useful in my research on the struggle between China and the United States. In any case, given the current situation, I believe that the proposal you offer of the strategic similarities of both countries reflects how alive technonationalism is.

    I also find the relationship between the state and intellectual monopolies very useful in shaping the new rules of the digital game. In the end, infrastructural power is fundamental in the struggle for hegemony and I believe that in the future this state-monopoly relationship will be key in the creation of rules in areas such as 5G or artificial intelligence.

    In relation to what you advance in the conclusions about the withdrawal of the United States from international coordination, do you think we can walk towards a world of fragmented digital ecosystems (for example, two different regions of the internet with their respective monopolies, one dominated by the US-EU and the other by China)?

    Thank you very much.

    Greetings,

    Juan Vazquez Rojo
    Universidad Camilo José Cela and Corporación Universitaria de Asturias

  • Cecilia Rikap says:

    Hi Juan,

    Thanks for your comment and question. Digital decoupling is not impossible and both countries have made moves on that direction, think of the US banning Huawei (and extending that ban to other countries such as the UK) and of China´s great firewall. However, China is still too dependent on US AI chips and other ICT infrastructure and the US is arriving late at 5G, a technology where Huawei is the pioneer. So fully fragmented digital economies is something that I do not see coming any time soon.

    What I see is a long term turf war where technology is a central weapon and the outcome not only depends on the contestants (US, China and their intellectual monopolies) but also on other core countries/regions, in particular the EU.

    Finally, if digital decoupling seems complicated, overall decoupling is simply impossible. Both countries are too dependent on each other on every front (in terms of supply chains, the monetary system, and even ideologically they build their strength by demonising their opponent).

    Best wishes and again thanks for reading and commenting.
    Cecilia

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