5G and China-US Relations: Competition and Intervention

Abstract

This study discusses the reasons that drive the US government to deviate from its private sector-dominated approach and implement state intervention in the competition with China over 5G. In order to better understand the reasons why the US sometimes intervenes in the market to gain a competitive advantage with respect to specific technologies, I examined and compared two case studies: the US response to competition with Japan over semiconductors in the 1980s, and the US response to competition with China over 5G in the 2010s and early 2020s. I argue that first, the US will intervene in the market to secure its technological advantage when it is outcompeted by foreign competitors; second, the US regards China as a strategic adversary, 5G gives China important economic and military advantages, therefore, the US government deviated from the free-market approach in order to maintain its strategic advantage.