The state-run media has held to a consistent line: If there was a bad word to be found on the subject of Facebook, they were ready to listen. “Fever and Doubts before Facebook goes Public: no Way That Valuation Is Reasonable,” Xinhua declared. Chinese radio was warning of a roller-coaster stock performance: “Ordinary Investors Should Avoid Me-Tooism.” People’s Daily focussed on co-founder Eduardo Saverin’s decision to “abandon America” by giving up his U.S. citizenship in a bid to avoid taxes. The story coined an unfamiliar new expression—calling Saverin an “American defector,” using the Chinese term usually applied to North Korean refugees who flee across the frozen Tumen River. (The talk of American defectors is impressively straight-faced, given the recent news of Chinese citizens fleeing to American diplomatic stations for protection.)

But on Weibo, the Chinese version of Twitter, the Facebook I.P.O. was not (yet) a banned subject, and it generated intense discussion. Commentators were torn: wanting to discuss the financial and tech implications, and smarting over their own lack of access to Facebook. “It’s like hearing the emperor is about to have sex; what’s there to be excited about if you’re a eunuch?” someone wrote. Others picked up on the fact that Mark Zuckerberg’s girlfriend is Chinese-American, with a nod to the phenomenon I wrote about recently in The New Yorker: Chinese men and their difficulty in securing the assets they need as prerequisites for marriage. (“I hear the I.P.O. is because Zuckerberg doesn’t have enough money to marry his Chinese girlfriend.”)

Beyond the snark and the state media, a more earnest discussion has gathered force. despite years of investment and official injunctions to advance Chinese technology, China has yet to produce a brand or original tech product with a fraction of the global influence of Facebook or Apple. Chen Yongdong, a Shanghai-based technology writer, adapted the title of a famous Chinese poem for an essay he called “Raising my Head to look up to Facebook; Lowering my Head to think about its Chinese Counterparts.” he wrote: “If you don’t have innovation, are you not going to be laughed at by the industry, and by the world?”

In all likelihood, China is approaching the end of its run as the world’s low-skilled workshop. there are fewer workers, and they are pursuing more income and skills; Vietnam and other neighbors are cheaper. The larger problem is existential: The nation that so often reminds the world that it invented printing, paper, gunpowder, and the compass is exceedingly uncomfortable about how far back it has to reach to name its world-beating inventions. China has excelled in several pockets of innovation (genomics and nanotechnology, for example) but those are the exception; Chinese technology is now best known for “process innovation”—reducing the cost of producing, say, low-end mobile phones for Huawei—and for the distinctly Chinese term, “re-innovation,” which involves making something simpler or cheaper than the original.

Even successful Chinese Internet companies, such as Tencent and Alibaba, are respected for their business achievements, not for their original insights. The obstacles are not a mystery: The government has failed to protect intellectual property or promote small- and medium-sized businesses with good ideas, to name a couple of factors.

Imagine, for a moment, the Chinese version of the Facebook story: A no-name undergrad in the Tsinghua University computer-science department gains notoriety for a high-profile prank that makes the university concerned about its digital security; instead of getting expelled, he starts a company, drops out, attracts prominent investors despite ignoring powerful players in the field, is invited to meet the President of the country, continues expanding, goes public, and makes billions. Impossible—for all kinds of reasons (a Chinese student who toys with a university network might not be enrolled by the end of the day), but the most vexing question may be, as an editorial in Nature once put it, “whether a truly vibrant scientific culture is possible without a more widespread societal commitment to free expression.”

That idea—that the political system that has nurtured China’s rise may also be limiting its next step—has not yet been thoroughly embraced. but events like Facebook’s listing make it clearer by the day. when Wang Ran, the chief executive of China eCapital, paged Facebook’s prospectus, he stumbled on a section that he had never fully apprehended until reading it in black and white. under a discussion of risks to the business, Facebook has listed a discussion of the potential impact if a government were to block the site. “The company listed four countries that have already banned Facebook’s services,” Wang wrote. “They are China, Iran, North Korea and Syria. I don’t know what you think about that, but I’m beginning to think this state of affairs is insulting.”

Illustration by Ed Nacional.

In China, Facebook’s Shadow and Worries About Innovation : The New Yorker