While many say ensuring a domestic chip supply makes sense, others point out that market forces are generally more effective than governments.

“The general history of industrial policy is not a very pretty one,” said Alan Sykes, a professor at Stanford Law School focusing on international economic relations. “A lot of money has been wasted on trying to promote particular industries that the government picks out but that entrepreneurs would not otherwise be promoting.”

As an example, Mr. Sykes points to the steel industry that has struggled with global oversupplies resulting from subsidies and other measures from governments around the world including China and the U.S.