China as a Counter-Hegemonic Challenge to the US: The Contradictions between Domestic Political Economy and Global Ambitions

Abstract

Drawing upon a refined neo-Gramscian framework, this thesis connects the form of China’s domestic hegemony to the nature, shape, and limits of its counter-hegemonic international challenge to the US. Financial, military, and productive power have constituted the material foundation of postwar American hegemony over the interstate system and the world economy. China’s capabilities in these areas are fundamental to chart a modernization path different from that demanded by the market-oriented world order while still benefitting from economic ties in the meantime. With a focus on central-provincial, party-state-business, and party-state-society relations, this thesis argues that Beijing has established a domestic hegemonic order led by the top leadership group featuring both coercion and consent. Establishing its unique domestic hegemony, however, has spawned unintended institutional constraints on China’s global financial and production reach. First, this thesis reveals the constraining dynamics of central-provincial relations on China’s semiconductor development. The management of fiscal and personnel systems strengthens the center’s power relative to that of provinces. Yet it also incentivizes provinces to pursue short-term, high-quantity achievements with poor cross-province industrial policy coordination, hindering the mobilization of strength to counter the US’s hegemonic power in technology, a national priority. Second, the thesis outlines the limitations on China’s ‘going out’ policy and economic statecraft. The principle of state-owned enterprises (SOEs) as bulwarks of the party-state impels top leaders to nurture a strong state sector. Close examination of the banking and internet services industries finds that Beijing, by consolidating SOE dominance in strategic areas through economic and financial governance, restricts the internationalization of Chinese businesses and currency and their potential to support the party-state’s foreign policy agendas. The analysis in the thesis moves beyond the often-narrow debates found in International Relations on China’s rise and contributes to our understanding of how contestations and consent among social groups within national borders affects the world order — and in this case, the contradictions between particular characteristics of China’s political economy and ultimately its constricted global ambitions.

Date of Award	6 Aug 2025
Original language	English
Awarding Institution	City University of Hong Kong
Supervisor	Sean Kenji STARRS (Supervisor) & Justin ROBERTSON (Supervisor)