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Trade Wars, Tech Rivalry and Geopolitical Tensions
In the last decade, escalating trade wars, technological rivalry and growing geopolitical tensions have shaped the global economic landscape. The U.S.-China trade dispute, concerns over technological supremacy and shifting alliances have dominated headlines and policy discussions, emphasizing the importance of geopolitical alliance in an increasingly volatile global economy.
Three key figures using 2015 data shed light on the relationship between geopolitical distance and international trade patterns before the recent escalation of global economic tensions. The first figure shows U.S. technology exports, represented by a royalty payment-to-population ratio (the ratio of the dollar value of royalty payments to the population of the country making the payments), plotted against geopolitical distance. Royalty payments are shown as a percentage of the paying country’s population to limit bias that could be caused by differing population levels. Geopolitical distance was computed using the absolute difference between countries’ foreign policy preferences based on United Nations voting data as measured by Michael A. Bailey, Anton Strezhnev and Eric Voeten.
Three key figures using 2015 data shed light on the relationship between geopolitical distance and international trade patterns before the recent escalation of global economic tensions. The first figure shows U.S. technology exports, represented by a royalty payment-to-population ratio (the ratio of the dollar value of royalty payments to the population of the country making the payments), plotted against geopolitical distance. Royalty payments are shown as a percentage of the paying country’s population to limit bias that could be caused by differing population levels. Geopolitical distance was computed using the absolute difference between countries’ foreign policy preferences based on United Nations voting data as measured by Michael A. Bailey, Anton Strezhnev and Eric Voeten.
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