NYU Economics Department

From the FT Weekend Essay by Gillian Tett “‘A group of economists at Stanford and Columbia have set up the so-called Global Capital Allocation Project (GCAP) Allocation Project to conduct research that “leverages recent advances in large language models to identify the areas of the global economy that are particularly vulnerable to geoeconomic pressure”. Their core thesis is that China today has hegemonic control of manufacturing (via its dominance of key supply chain nodes such as rare earth minerals) but the US has hegemonic control of finance (because of the dollar’s reserve currency status).   Hence one way to make sense of White House actions is that America is trying to undercut China’s industrial hegemony while also protecting its own financial dominance, and vice versa. Tech hegemony, in my view, is still being contested.  Such thinking not only explains US-China relations; it also sheds light on how other countries are reacting, since the priority for them now is to create “anti-coercion” strategies, as the GCAP says. Unsurprisingly, this is sparking intense debate in places such as Britain”