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Data-intensive Innovation and the State: Evidence from AI Firms in China

January 29, 2020 @ 4:30 pm - 5:30 pm

Speaker: David Yang (Harvard)
Title: Dataintensive Innovation and the State: Evidence from AI Firms in China
Abstract: Dataintensive technologies such as AI may reshape the modern world. We propose that two features of data interact to shape innovation in dataintensive economies: first, states are key collectors and repositories of data; second, data is a non-rival input in innovation. We document the importance of state-collected data for innovation using comprehensive data on Chinese facial recognition AI firms and government contracts. Firms produce more commercial software and patents, particularly dataintensive ones, after receiving government public security contracts. Moreover, effects are largest when contracts provide more data. We then build a directed technical change model to study the state’s role in three applications: autocracies demanding AI for surveillance purposes, data-driven industrial policy, and data regulation due to privacy concerns. When the degree of non-rivalry is as strong as our empirical evidence suggests, the state’s collection and processing of data can shape the direction of innovation and growth of dataintensive economies.


January 29, 2020
4:30 pm - 5:30 pm
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