Re-Embedding or Re-Surveilling? Digital Protectionism Amid Surveillance Capitalism

Abstract

This article investigates the rise of digital protectionism within the regulatory framework shaped by surveillance capitalism and digital sovereignty. Drawing on Karl Polanyi’s concept of the double movement, I argue that digital protectionist instruments such as data localization mandates, restrictions on cross-border data flows and tech nativization represent attempts to re-embed digital markets within the context of digital sovereignty. On the other hand, these measures also tend to reinforce, rather than eliminate, data exploitation processes at the core of surveillance capitalism, thereby creating a regulatory paradox: Sovereignty claims enable the institutionalization of domestic surveillance as part of digital disembeddedness. Throughout the article, I adopt an interdisciplinary conceptual approach, grounded in economic sociology and political economy, to examine how sovereignty-based protectionist instruments can restrict data extraction while simultaneously enabling exploitative domestic surveillance. Finally, this article concludes that sustaining a fairer digital economy requires embedding data relations in enforceable rights and social values; otherwise, digital protectionism may reproduce the exact structures it seeks to oppose.