Jing Li
Professor
International Business and Canada Research Chair (CRC) in Global Investment Strategy
Simon Fraser University

UNPACKING TECHNO-NATIONALISM: EVIDENCE FROM MADE IN CHINA 2025 AND
THE U.S. POLICY RESPONSE

ABSTRACT:  We examine an important but underexplored question: How does a technology policy in an emergent power affect the cross-border acquisitions of its firms in an era of geopolitical rivalry? Using balance of power theory, we focus on home-host-country policy interactions to understand the impact of techno-nationalism on firms’ international acquisitions. Geopolitical rivalry suggests that a home country’s proactive technology policies (aimed at technology catchup and development) may lead to a rival country’s reactive/defensive techno-nationalism (aimed at defending technology leadership). We therefore predict that although home-country technology policies may lead to more international acquisition attempts by its firms, defensive policies in the host (rival) country may increase regulatory barriers and hinder the MNE’s acquisition completion in the host country. Using acquisition data on Chinese firms from 2010 to 2019, we examine how the introduction of China’s Made in China 2025 policy and the US’s heightened regulatory response (FIRRMA) affect the acquisition announcements and completions of Chinese firms in the US. We then extend the analysis to other technology-leading host countries and to the US’s security allies to understand whether the US regulatory response results in policy diffusion. Our study informs international business and innovation research and practice.