The Emergence of Institutional Architecture to Govern Artificial Intelligence: Investigating the State’s Role in Digital Capitalism

12 MAY
9:00 AM (HK Time, UTC + 8)
RM 4472 (Lift 25/26), Academic Bldg, HKUST
Division of Public Policy (PPOL)

Division of Public Policy (PPOL)






Numerous governments issued policy and regulatory documents for AI in the last years to deal with opportunities and challenges posed by this technology. However, a systematic understanding of the roles that the governments are taking is lacking in the academic literature.


The analysis of the global landscape of policy initiatives using qualitative content analysis and LDA topic modeling shows that the state has three major roles in governing AI: development, control, and promotion. The analysis of regulatory documents and game theoretic modeling shows that some countries prioritize consumer protection through stringent regulation. In contrast, others promote innovation by adopting a more hands-off approach when balancing a trade-off between regulation and innovation. However, minimal regulation is rationalizable only if a government is not prioritizing consumer welfare but tries to maximize innovation, domestic producer surplus, or perceived consumer welfare.


Russia presents an interesting case where the state takes on the role of “development” by actively participating in technological innovation. At the same time, it implements a hands-off approach to regulation through unenforceable ethical principles. Fifty interviews with AI companies, academics, and policymakers in Russia show that companies have little motivation to comply with ethical regulations. The major motivational constraints are profit-seeking behavior for economic motivation, ethical ignorance for normative motivation, lack of credible threat for social motivation, and technological infeasibility for technological motivation. This regulatory regime was formed under the strong influence of big tech companies, which saw an opportunity to avoid regulatory oversight by washing out concrete regulatory measures from the policy. Unenforceable ethics-based self-regulation is a regulatory gift from the Russian government to the industry.


By applying the lens of the regulation theory, this form of the state’s intervention in the governance of the socio-technical system is conceptualized as a regulatory regime under the accumulation regime of digital capitalism.


Division of Public Policy (PPOL)