One quick look at the world's shifting economic centre of gravity

With constant twitter and Facebook updates, I find myself putting off blogging anything altogether. Many items that might have appeared here have gone there instead. But then this entry doesn't really go in 140 characters.

At Hay Festival last weekend I appeared together with Howard Davies on a panel discussing the global economic crisis. For that and for some work (teaching, writing) that I'm doing on the global economy, I prepared this animation:




(A somewhat fuller-sized animation appears on my econ.lse site... but then we are talking about the world, so, despite the best efforts of Google Earth, anything on a computer screen will always be a little too small and representational.)

Obviously, a few more things need still to be thought through on this but for now the flat-world map animates the shift in the world's economic centre of gravity (building on calculations by Jean-Marie Grether and Nicole Mathys). The rise of China and India since the early 1980s has shifted the world's economic center of gravity 1800 km - 1/3 of the planet's radius - deeper into the Earth's crust, away from the US, and towards the East. The transition accelerated in 1991 and 2001, each time the US was in recession.

It might seem peculiar that the world's economic centre of gravity is so far north - is there some massive production going on near the North Pole that the world's military haven't told us about? No, that feature comes instead from how the 2-dimensional flat map has to represent something going on in a 3-dimensional spherical Earth. Suppose, for illustration, that Earth has two roughly equal centres of production at the same latitude just north of the equator but on the same great circle. Their centre of gravity is at that same latitude but deep within the Earth. Then, when you project a straight line from the Earth's centre to that centre of gravity and keep going until you burst out of Earth's surface, you come out quite far north - certainly further north than those two production centres were to begin. So, as long as most of Earth's production occurs in the Northern Hemisphere and aren't all closely located to each other so that only one side dominates, projection onto a 2-dimensional flatmap always shows the centre of gravity on the Earth's surface appearing quite far north.

Although it's not, strictly speaking, an error, I do think some re-definition of concepts would be useful. That's something I'm trying to fix now.

PS I've already referred to my paper on post-1990s East Asian economic growth elsewhere on this blog but, yes, that article contains more detail on the effects described in the animation.