Policy Brief - The Technological Paradigm, Stupid
An enormous gap exists in AI innovation between the two sides of the Atlantic. Is there any hope for the EU to compete with AI technology developed by US-based firms?
European policymakers keep pushing the narrative that boosting AI development is key to European competitiveness. But stakes are much higher because super-intelligent AI will confer enormous geopolitical leverage on those who control it
Download the IEP@BU Policy Brief The Technological Paradigm, Stupid by Giorgio Presidente
Executive Summary
European policymakers keep pushing the narrative that boosting AI development is key to European competitiveness. But the stakes are much higher because super-intelligent AI will confer enormous geopolitical leverage on those who control it.
Europe has three options. The first is accepting the dominance of US incumbents in frontier AI development, and instead specialize in AI applications.
The second option is forming a joint venture under EU governance. This would allow European firms to compete with incumbent tech giants and mitigate the geopolitical risk involved in having frontier AI controlled by a few private citizens.
The third option is to develop a different kind of AI. The current vintage of frontier models relies on huge amounts of data for training. Due to market forces and political constraints, it is unlikely that European firms will ever be able to compete in “data-intensive” AI.
Thus, the best chance for Europe is to develop systems that are less subject to such a comparative disadvantage. But radical innovation requires risky experimentation. Cutting red tape and re-directing public support to high-risk-high-reward projects is what it will take.
Giorgio Presidente
Giorgio Presidente is Research Fellow at the Institute for European Policy-Making at Bocconi University and Research Associate at the Oxford Martin Programme on the Future of Work, University of Oxford.
He is interested in topics related to technology, firms and productivity, remote work, and market power. Previously, he held positions at the World Bank, the Organization for Economic Co-operation and Development, the European Central Bank, and the United Nations. He holds a Ph.D. from Paris School of Economics.
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When Will Germany Be Back?
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The day after the federal snap election, we will explore the European consequences of the vote against the backdrop of Germany’s economic challenges.
In November 2024, a coalition government collapsed when Chancellor Olaf Scholz dismissed Finance Minister Christian Lindner, highlighting Germany’s ongoing struggle to balance its political ambitions, renewed security priorities, and stringent budget rules.
For the first time in decades, the European Union faces a dual leadership vacuum in Germany and France—two pivotal member states in EU politics.
Meanwhile, geopolitical and economic challenges continue to escalate: the war in Ukraine demands unwavering commitment from the EU's leading states and institutions, and Donald Trump’s return to power introduces uncertainty to global economic and multilateral governance.
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Wolfgang Munchau is one of the foremost commentators on EU economic and political affairs. He is the director of Eurointelligence and the author of the recent book Kaput: The End of the German Miracle.
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Stefano Feltri, IEP@BU communication advisor, will moderate the conversation.
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Eleanor Spaventa, Professor of European Union Law at Bocconi Law School
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