China’s Corporate Social Credit System and the Dawn of Surveillance State Capitalism

China’s corporate social credit system (CSCS) is a big data project to evaluate the “trustworthiness” of all business entities registered in the country, including foreign firms. The CSCS, which runs parallel to a system of evaluation for individuals, is linked to a system of corporate rewards and punishments, representing a futuristic strategy of automated screening to determine which enterprises are allowed market access and benefits. When the system is fully operational, it portends the transformation of China’s economic and corporate regulatory system into what Stanford Law School professor Curtis Milhaupt and his co-author Yu-Hsin Lin call “surveillance state capitalism.”

 

This session will explore Professor Milhaupt and Lin’s findings from their empirical analysis of the CSCS scoring system, based on its recent rollout in Zhejiang Province (one of the first to implement the CSCS at the local level), as well as the potentially far-reaching implications of the CSCS for the country as a whole. This session will also examine intensifying capital market frictions between the U.S. and China fueled by national security and data security concerns.