The Silicon Sovereignty Paradox: Navigating Fluid State-Corporate Power Dynamics in the Age of AI

Abstract

As AI development companies begin to rival sovereign states in political, economic and technical power, their interactions are often framed as zero-sum battles for control. This paper challenges the existing view of state–corporate relations as purely adversarial by introducing a bidirectional framework that categorizes their dynamics into four modes of power enhancement and erosion, analysed through political, economic, and technical lenses. Case studies from the U.S., EU, China, and Russia illustrate the fluid and context-dependent nature of these relationships. While constrained by a great power–centric focus and limited empirical scope, this framework offers a more realistic foundation for designing nuanced AI governance mechanisms that reflect the complexities of an AI-shaped global order.