Panel 2: The State as Governor and Participant in Digital Markets

May 8, Morning Session

Chair:

Luis Flores, Department of Sociology, University of California, Berkeley

Discussant:

Cihan Tugal, Department of Sociology, University of California, Berkeley

Han Zhang, Department of Sociology, Brown University

2.1  Neither Leviathan Nor Polanyian: China’s Governance of Transnational Educational Platforms

Le Lin, Department of Sociology, University of Hawaii at Manoa

Abstract

Existing literature on China’s governance of digital platforms depicts the state as either a despotic Leviathan willfully imposing coercive restrictions, or a Polanyian savior that sides with platform laborers and contains disorderly expansion of platform capitalism. Featuring the entire platform ecology that include the platform, the state, laborers and customers, this paper demonstrates a more complex and dynamic governing process in which the interactions among these actors derailed state policy goals.

My qualitative data are based on multi-wave in-depth interviews, survey and online data a China-based, one of the world’s largest education platforms that employed more than 100K North American teachers at its peak. I start with a description of the platform’s transnational nature and the demographic characteristics of its laborers. Then I introduce the state’s “Double Reduction Policies of 2021” that aimed to ban all transnational teaching on platforms, and highlight three reactions to the policy change: a) the platform shifting the policy-induced risks to laborers and customers; b) the platform forming allies with laborers and customers to get around state ban; c) the platform gaining greater control over laborers in this process.

Eventually, the state gave up pursuing its policy goals and turned a blind eye despite large-scale complaints of customers about platform malpractices. I argue that, when it comes to interstice-rich transnational platforms and when we adopt a dynamic perspective toward the platform ecology, the Chinese state is rarely Polanyian for its policy goal and the interactions in the platform ecology can deviate the state away from its despotic Leviathan role.

2.2  Ghosts in the “Machine that is Learning”: Disruptions and Continuities in Modern China’s Experimental and Scientific Governance

Jamie Wong, Department of Anthropology and the Princeton Institute for International and Regional Studies, Princeton University

Abstract

In the business-to-government (B2G) market in China, venture capital investors, startup entrepreneurs, and local governments form partnerships to fulfill central state national mandates. In their own telling, they are nodes within a bigger algorithmic assemblage to generate policy, an idea encapsulated in the imagery of their rhetorical question: “what is our nation but a machine that is learning?”

This paper challenges my interlocutors’ claim that this machine learning analogous mode of governance is a continuation of the experimental philosophy Deng espoused during China’s reform and opening in 1990s. Considering a broader historical purview, I show instead how the notion of longstanding Chinese experimental and scientific governance papers over subtle but consequential historical changes in policy approach. In particular, drawing on Arunabh Ghosh’s work on the epistemological, ideological, and institutional convictions of a young Chinese socialist state under Mao Zedong, I highlight the current government’s drastic departure by embracing the spirit of what Mao disdainfully terms “bourgeois statistics.”

Reconsidering rhetorics and configurations of continuity and disruption, I show how the ghosts of leaders past paved the way for the antithesis of their philosophies in the current VC-driven policy landscape, and how it nonetheless aligns with a broader historical approach of Chinese adaptive governance that has reified one-party rule in China.

2.3 Incumbent’s Advantage via Expertise Asymmetry: Revitalization of the Chinese Pearl Industry with Livestreaming

Lizhi Liu (Georgetown University)

Rebecca Karp (Harvard University)

Wesley W. Koo (Johns Hopkins University)

Liaodan Zhang (Zhejiang University)

Abstract

This study examines how incumbents in mature industries can revitalize their industries amid technologically adept entrants. Using a longitudinal qualitative study of China’s pearl industry (2017–2024), we trace how incumbent pearl firms and livestreaming-first entrants (LSFs) interacted as livestreaming transformed the industry. Drawing on ethnographic, interview, and archival data, we find that revitalization unfolded through a three-phase process—hardening, expansion, and alignment—that we term an incumbent-led industry revitalization. In the hardening phase, incumbents partnered with LSFs to professionalize livestreaming, but rigid templates reinforced traditional perceptions of pearls and yielded limited growth. During expansion, incumbents integrated livestreaming into their core businesses, using their deep industry expertise to deviate from LSFs’ templates, introduce new designs, and broaden the meanings and uses of pearls. Meanwhile, entrants cultivated the perception of expertise through templated narratives and unverifiable claims, expanding but also destabilizing the value proposition. In the alignment phase, incumbents leveraged livestreaming’s transparency to amplify their industry expertise and codify new evaluative standards, while entrants adapted by borrowing these standards and reinforcing incumbents’ frameworks. We theorize expertise asymmetry enabled incumbents to harness entrants’ technologies while maintaining control. The study contributes to research on industry evolution and technological change by explaining how incumbents can renew their industries’ value propositions without being displaced by new entrants.