Any successful coach will tell you that if you have a winning playbook, don’t throw it out. Stick with what works. And that principle applies not just in sports, but in other fields too.
Take the United States and China. They’re locked in a battle for semiconductor dominance because both know that the winner will have an edge in the technologies that will shape the economic and security environment for decades to come.
Fortunately, the U.S. is already way ahead. It’s by far the world leader in semiconductor technology, and as long as it continues following this formula, there’s little China can do to catch up. It might even bankrupt itself trying.
The golden formula is as follows: U.S. semiconductor firms pour enormous sums of money into developing the world’s most advanced microchips. To maximize the amount of cash available for research and development, they outsource manufacturing to third-party foundries, many of which are in Taiwan. Not having to foot the tens of billions of dollars required to build each fabrication facility, U.S. chip designers have more capital to use for R&D, which results in even more advanced chips, and the process continues.
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