Part 10/15:
Many economists anticipate that the rivalry between the US and China will intensify, given China’s strong manufacturing base and strides in technology. Rajan acknowledges that manufacturing constitutes a larger share of China’s economy than the US, yet warns that maintaining technological superiority—particularly at the global frontier—is critical for China’s sustained rise.
While China’s manufacturing may do well in the immediate term, the real challenge lies in technological innovation, intellectual property rights, and moving up the value chain. To become the dominant economy, China must sustain vast growth in knowledge-based industries, a key factor that could eventually determine whether it outpaces the US.