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

Martin Beraja, David Yang and Noam Yuchtman

No 27723, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Developing AI technology requires data. In many domains, government data far exceeds in magnitude and scope data collected by the private sector, and AI firms often gain access to such data when providing services to the state. We argue that such access can stimulate commercial AI innovation in part because data and trained algorithms are shareable across government and commercial uses. We gather comprehensive information on firms and public security procurement contracts in China’s facial recognition AI industry. We quantify the data accessible through contracts by measuring public security agencies’ capacity to collect surveillance video. Using a triple-differences strategy, we find that data-rich contracts, compared to data-scarce ones, lead recipient firms to develop significantly and substantially more commercial AI software. Our analysis indicates a contribution of government data to the rise of China’s facial recognition AI firms, and suggests that states’ data collection and provision policies could shape AI innovation.

JEL-codes: E0 H4 L5 L63 O25 O30 O40 P00 P16 Z21 (search for similar items in EconPapers)
Date: 2020-08
New Economics Papers: this item is included in nep-big, nep-cna, nep-mac and nep-tid
Note: EFG POL PR
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

Published as Martin Beraja & David Y Yang & Noam Yuchtman, 2023. "Data-intensive Innovation and the State: Evidence from AI Firms in China," The Review of Economic Studies, vol 90(4), pages 1701-1723.

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Related works:
Journal Article: Data-intensive Innovation and the State: Evidence from AI Firms in China (2023)
Working Paper: Data-intensive innovation and the state: evidence from AI firms in China (2022)
Working Paper: Data-intensive innovation and the State: evidence from AI firms in China (2021)
Working Paper: Data-intensive innovation and the State: evidence from AI firms in China (2021)
Working Paper: Data-intensive innovation and the State: evidence from AI firms in China (2021)
Working Paper: Data-intensive innovation and the State: evidence from AI firms in China (2021)
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