The Chinese AI Economy

China’s AI economy operates on fundamentally different principles from the US model.

While US AI is characterized by frontier-model competition between a handful of well-funded labs, China has built a parallel system optimized for deployment velocity, ecosystem integration, and infrastructure — as explored in the economics of AI compute infrastructure — -native AI that embeds directly into commerce, services, and industrial applications.

The performance gap has narrowed from over a year to under three months, but the strategic divergence is widening.

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