The Economics Show China and the limits of its ‘engineering state’. With Dan Wang
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Sep 12, 2025 
Dan Wang, a research fellow at Stanford's Hoover History Lab and author of 'Breakneck: China’s Quest to Engineer the Future', discusses China's rapid industrial growth and the challenges it faces, including overproduction and deflation. He contrasts China's engineering-driven economy with the U.S. legalistic approach, exploring the societal pressures on young professionals. The conversation delves into government interventions to boost consumer demand, the complexities of the property market, and the implications of technological advancements in the industrial metaverse.
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Relentless State Funding Built Capacity
- China's long-term strategy was to fund manufacturing and strategic sectors until they win, accelerating after Xi took power.
- That produced waste and corruption but also steadily rising export capabilities.
Engineering Mindset Shapes Policy
- China's leaders are predominantly engineers who see building as the solution to most problems.
- That mindset leads the state to treat society as an engineering problem with costly missteps.
Involution: Hustle Without Returns
- 'Involution' describes fierce competition with little productivity gains and massive overwork like 996.
- Sectors such as solar and EVs face hyper-competition and thin profits despite technological gains.
