3 ms·

There were intense arguments regarding whether to buy or to research in China. The "buying is better" party won and hence China lost ~30 years on chips R&D. But

by mrjin 3y ago

There were intense arguments regarding whether to buy or to research in China. The "buying is better" party won and hence China lost ~30 years on chips R&D. But the embargo snapped right on the faces of the "buying is better" guys and leaving China no choice but to bite the bullet. So what those Chinese pioneers wanted but failed to achieve has now firmly implemented by the embargo...

hunglee2 3y ago
US policy reflexive and unreflective when it comes to China. Export controls on simply redirect investment inward to domestic R&D and subsequent production capacity. Effectively, this is defunding US and US-controlled companies, who otherwise would have hoovered up Chinese money, fed into its own R&D and maintained the lead on Chinese companies. The policy doesn't even succeed on its own terms. But no iteration, no reflection
- The_Colonel 3y ago
  It's again the same opportunity cost, though. China has to invest a lot of money just get access at scale to the same class of chips as the rest of the world. That money could be used for actual innovation instead. > The policy doesn't even succeed on its own terms. The policy doesn't succeed only if you limit your thinking on the chip industry and ignore the overall strategic context. Reducing China's access to latest & greatest is only the proximate reason for the export controls, with the overall strategic competition being the ultimate reason. It's simply a mean to an end. As you said in your previous post, China would likely prefer to continue buying western chips, because being forced to develop their own will not improve their strategic posture, at least in the next years/decades.
  - mrjin 2y ago
    Indeed, China preferred buying from external sources as merchants won the debate on whether to buy or to research and it's indeed cheaper in short term. Dependency on critical parts from external could be the only viable solution for smaller countries, but for countries like China is a intolerable risk to national security and has to be addressed at highest priority. The embargo just demonstrated how bad it could be, and it actually can be much worse in different contexts. So, obviously R&D is the only option left on the table. Cost is no longer a problem.
- mrjin 2y ago
  The reason behind is that US lost its confidence to compete. So if it cannot compete, it might be easier to remove the competitors. Such move would work on smaller countries such as Japan etc. But China is another story.

by mrjin 3y ago

hunglee2 3y ago

US policy reflexive and unreflective when it comes to China. Export controls on simply redirect investment inward to domestic R&D and subsequent production capacity. Effectively, this is defunding US and US-controlled companies, who otherwise would have hoovered up Chinese money, fed into its own R&D and maintained the lead on Chinese companies. The policy doesn't even succeed on its own terms. But no iteration, no reflection

The_Colonel 3y ago
It's again the same opportunity cost, though. China has to invest a lot of money just get access at scale to the same class of chips as the rest of the world. That money could be used for actual innovation instead. > The policy doesn't even succeed on its own terms. The policy doesn't succeed only if you limit your thinking on the chip industry and ignore the overall strategic context. Reducing China's access to latest & greatest is only the proximate reason for the export controls, with the overall strategic competition being the ultimate reason. It's simply a mean to an end. As you said in your previous post, China would likely prefer to continue buying western chips, because being forced to develop their own will not improve their strategic posture, at least in the next years/decades.
- mrjin 2y ago
  Indeed, China preferred buying from external sources as merchants won the debate on whether to buy or to research and it's indeed cheaper in short term. Dependency on critical parts from external could be the only viable solution for smaller countries, but for countries like China is a intolerable risk to national security and has to be addressed at highest priority. The embargo just demonstrated how bad it could be, and it actually can be much worse in different contexts. So, obviously R&D is the only option left on the table. Cost is no longer a problem.
mrjin 2y ago
The reason behind is that US lost its confidence to compete. So if it cannot compete, it might be easier to remove the competitors. Such move would work on smaller countries such as Japan etc. But China is another story.