The New Big Three Economies

Many news reports this week talked about China as the leading world economy.  It depends how you count.

"Until just a few years ago the largest national economies existed in the developed world.  United States, Japan and Germany (The Big Three) achieved the largest gross domestic product (GDP) in 2000.  'Ten years ago rich countries dominated the world economy, contributing around two-thirds of global GDP after allowing for differences in purchasing power.  Since then that share has fallen to just over half.  In another decade it could be down to 40%.  The bulk of global output will be produced in the emerging world,' wrote The Economist in 2010.  In the last 20 years or so the developed and developing worlds have undergone a re-positioning with the explosion of rapidly expanding, formerly developing economies in Brazil, Russia, India and China, which are known collectively by the acronym BRIC.  In fact, Goldman Sachs’ projections suggest China will jump into the number two position in the new Big Three list by 2020 and will become number one, surpassing the United States by 2050, and India will become the third largest economy as measured by GDP unless something cataclysmic derails its unprecedented growth, which by some measures approaches 10% annually.   

"Three forces will dictate China’s rise…demography, convergences and 'gravity.'" 

from Threes, Chapter 6, “Threes in Economics and Finance”