A perfect example of this manager's dilemma is Chinese semiconductors. For years, it made sense for the Chinese to 'buy built' rather than setting up a complete

A perfect example of this manager's dilemma is Chinese semiconductors. For years, it made sense for the Chinese to 'buy built' rather than setting up a complete semiconductor industry from scratch. They were perfectly happy buying billions of dollars worth of semiconductors from the US. It was cheaper, easier and faster to do so. It also helped offset the huge trade deficits that the US had with China. Then the US banned semiconductor sales to China. That was a bad, short-term move by the US. The Chinese are now forced to set up from scratch a complete semiconductor industry. By starting now, they don't have billions invested in older technology, so they can immediately go with current technology and look to more advanced technology. A side-issue is the banning of ASML's machinery sales to China also. Now the Chinese have a two-fer. Not only will they make their own semiconductors and compete with the other established semiconductor manufacturers, and undercutting them because they have the largest semiconductor market. They will be able to do exactly the same thing with the fab-manufacturing market and out-compete those manufacturers too. ASML is doomed, the US semiconductor manufacturers are doomed. US semiconductor manufacturing will go the same way as the US manufacturing of textiles, paper, electronics, steel, appliances, tools, drugs, etc, etc, etc. "Big mistake. BIG! HUUUGE!" as Julia Roberts says in "Pretty Woman".