8/8/2019 World is Spiky

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THE WORLD IN NUMBERSThe W orld Is SpikyGlobalization has changed the economicplaying field, but hasn't leveled it

I POPULATIONUrban areas house half uf all theworlds people, and continue to growin b oth rich and poor countries.

T lie world, according to the titleof the New York Times co\uTi\-nist Thomas Friedman's book., is flat.Thanks to advances in technology, theglobal playing Held has been leveled,tbe prizes are the re for the taking, andeveryone's a playerno m atter whereon the surface of the earth he or shemay reside. "In a flat world," Friedmanwrites, "you can innovate without hav-ing to emigrate."Friedman is not alone in this belief:for the b etter part of the past ce nturyeconomists have been writing aboutthe leveling effects of technology.P'rom the invention of the telephone,the automobile, and the airplane to therise of the personal computer and theInternet, technological progress has

steadily erode d the economic impor-tance of geographic placeor so theargument goes.But in partnersh ip w ith colleaguesat George Mason University and thegeographer Tim G ulden, of the Centerfor Internation al and Security Stud-ies, at the University of Maryland, I'vebegun to chart a very different eco-nomic topography. By almost anymeasure the international economic

landscape is not at al! flat. On the con-trary, our world is amazingly "'spiky."In terms of both sheer economic horse-power and cutting-edge innovation.

PEA KS, HILLS, AN D VALLEYSWhen looked at through the lens of economic production, many citieswith large populations are diminished and some nearly vonish. Threesorts of places make up the modern economic landscape. First arethe cities that generate innovations. These are the tallest peaks; theyhave the capacity to attract global talent and create new products andindustries. They are few in number, and difficult to topple. Second arethe economic "hills"places that monufacture the world's establishedgoods, take its calls, ond support its innovation engines. These hillscan rise and fall quickly; they are prosperous but insecure. Some, likeDublin and Seoul, are growing into innovative, wealthy peaks; othersare declining, eroded by high labor costs and a lack of enduring com-petitive advan tage. Finally there are the vast valleysplaces w ith littleconnection to the global economy and few immediate prospects.

surprisingly few regions truly mat-ter in today's global economy. What'smore, the tallest peaksthe cities andregions that drive the world econ-omyare growing ever higher., whilethe valleys mostly langu ish.

The most obvious challenge tothe flat-world hypothesis is theexplosive growth of cities worldwide.More and more people are cluster-ing in urban areasthe world's demo-graphic m ountain ranges, so to speak.The share of the world's populationliving in urban areas, jnst three per-cent in 1800, was nearly 30 percentby 1950. Today it stands at abon t .50percent; in advanced countries threeout of four people live in urb an areas.Map A shows the uneven distribution

of the world's population. Five mega-cities currently have more than 20million inhabitants each. Twenty-fourcities have more than 10 million inhab -itants, sixty more than 5 million, and150 more than 2 .5 million. Populationdensity is of course a crud e indicatorof human and economic activity. But itdoes suggest that at least some of thetectonie forces of economics a re concen-trating people and resources, and push-ing up some places more than others.

Still, differences in population den-sity vastly unders tate tbe spikiness ofthe global economy; the continuingdominance of the world's most produc-tive urban areas is astounding. Whenit comes to actual economic output,the ten largest U.S. metropolitan areascombined are behind only the United

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