The article discusses China’s economic challenges, particularly in the technology sector including AI and electric vehicles, where intense competition is leading to a phenomenon called ‘involution’ - a situation where companies engage in cutthroat competition that drives down prices but doesn’t necessarily lead to meaningful innovation. The piece examines how China’s tech giants and startups are caught in cycles of aggressive competition, particularly in AI development and implementation, leading to deflationary pressures and potentially unsustainable business practices. The article highlights how Chinese companies are racing to develop and deploy AI technologies, often at the expense of profitability, creating a market environment where participants work harder but achieve diminishing returns. This situation is exemplified by the intense competition in various sectors, including AI, where companies are making massive investments in research and development while facing declining profit margins. The analysis suggests that while this competitive environment has accelerated technological adoption and innovation in China, it may also be creating economic instability and unsustainable business models. The piece concludes by questioning whether this approach to technological development, particularly in AI and other advanced technologies, can sustain China’s economic growth in the long term, especially given the broader context of global competition and economic pressures.