Navigating Turbulence: The Challenge of Inclusive Innovation in the U.S.-China AI Race
A new study reveals how data privacy, IP, and export controls shape the global AI competition.
A new academic paper by Jyh-An Lee and Jingwen Liu, slated for publication by Oxford University Press in 2026, provides a nuanced legal analysis of the U.S.-China AI rivalry. The study, 'Navigating Turbulence: The Challenge of Inclusive Innovation in the U.S.-China AI Race,' argues that the geopolitical competition is leading to 'exclusionary rulemaking on a global scale.' It moves beyond simple narratives of technological supremacy to examine how each nation's legal infrastructure fundamentally shapes the trajectory of AI development.
The authors conduct a comparative analysis of three pillars: data privacy laws, intellectual property (IP) rights, and export controls. Their findings present a complex picture. China's legal environment may offer certain advantages for rapid innovation, such as greater access to training data and strong state-backed IP protection for domestic firms. However, the United States maintains a critical strategic edge through its enforcement of strict export restrictions. These controls target the lifeblood of advanced AI: semiconductor chips, the AI models themselves, and outbound investments in these sectors. This creates a significant bottleneck for China's ambitions.
Ultimately, the paper illuminates the tension between 'inclusive innovation'—broad, collaborative advancement—and the reality of a bifurcated technological landscape. The legal frameworks are not just background policy; they are active weapons in the race, determining who gets to build with the best tools and on what terms. The study suggests the rivalry is less about raw coding talent and more about controlling the underlying legal and supply chain architectures that enable AI progress.
- The study compares U.S. and Chinese legal frameworks across data privacy, IP rights, and export controls, identifying key structural advantages for each nation.
- It argues China may have an edge in data access for training AI models, while the U.S. holds superior power via strict export controls on chips and AI technology.
- The authors conclude the geopolitical rivalry is fostering 'exclusionary rulemaking' that threatens globally inclusive AI innovation, shaping the future of the field.
Why It Matters
For tech leaders, this analysis reveals that winning the AI race depends as much on legal and export policy as on algorithmic breakthroughs.