The United States holds a competitive advantage over China in spreading technological innovations throughout its economy, according to a RAND Corporation analysis. While both nations have developed effective but fundamentally different diffusion models—the U.S. market-led and China state-coordinated—America performs stronger across research organizations, enterprise dynamics, and absorption capacity. However, both countries struggle with adoption gaps among small and medium-sized enterprises, which employ the majority of their workforces. China’s state-driven approach enables rapid deployment in strategic sectors but risks inefficiencies and resource misallocation, while U.S. diffusion remains concentrated in large firms and advanced sectors. More: rand.org
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