Friday, 27 May 2011

Aerotropolis by John Kasarda and Greg Lindsay

Aerotropolis: The Way We'll Live Next

In the past Empires were built on the demand for spices. What was so special about spices?  Basically it was that they were valuable, imperishable and portable.  Before modern technology, in particular modern transport, they were just about the only commodity which it was technically feasible to trade on a global scale.  But as technology has developed what can be traded has changed.  And it is still changing.  This book looks at the implications.


It is a very modern book, despite the old fashioned Simcity-like cover. Its a mixture of an economic analysis, a travel guide and an exercise in futurology.   But above all, it is mine of anecdotes and observations around the way the world is changing.  You can dip into it profitably, or you can read it as narrative.  You can basically tune into it with whatever attention span you have available.  If this is done deliberately, it is done with great skill. But I have a feeling that is just the way the authors' heads are wired.  They are comfortable in the world of timezone hopping travel where time is parceled out to you in variable length dollops and you have to adopt to it in whatever way you can.

The pace is fast, the tone is clear.  Like air travel itself, time is of the essence and an international audience is anticipated.  The authors happen to be American, but their nationality is about the least relevant thing about them, as I'm sure they'd agree.  They are defined not by the country in the world that they live in but by the way that travel about the world.  You would be hard put to place their politics either.  They are clearly in favour of free trade though they feel no need to state it explicitly.  They are clearly in favour of state intervention, again by implication.  But really they are in favour of things that get things going and keep them moving.  I suspect that they would agree with Deng Xiaoping.  The colour of the cat is unimportant, so long as it catches mice.

Aerotropolis - changing world trade


It looks at two of the technologies that emerged in the  twentieth century and which are set to dominate this one.  The Internet has revolutionised the way you can find and buy a product, and air travel has revolutionised the way that product can be delivered.  These things mesh together to create the 'physical internet'.  Airports become the hubs not just for travellers but for good that are ordered online and transported by air.  Like the spices of a former age, only goods that meet the criteria.  They should be light and high value.  Wheat is out.  Ipods are in.  They are made anywhere in the world but easy access to an airport is essential.  In effect, the manufacturers of these high value goods, along with providers of more basic services like sandwiches are drawn to the environs of the large airports of the world.  An Aerotropolis is born.

Memphis is the world's biggest aerotropolis, handling nearly 4 million tonnes of cargo a year.  This is very big business indeed. Some 1 in 3 of the jobs in the region are linked to airport, including the head office of Federal Express.

In some ways this is just geography as usual with businesses locating to where it makes sense for them to be.  So if you are Fed Ex, locating near a large aerotropolis like Memphis does make perfect sense, just like a blacksmith setting up shop at a crossroads.  But the spice traders of the past profoundly changed the culture and politics of the world they lived in.  And they were just doing what made commercial sense as well.

The combination of the internet offering an almost infinitely long shop window, and the network of huge airport hubs across the planet able to meet consumer demands for high value goods only a few days after a  mouse has been clicked is unprecedented.  The volume of the goods being traded is not huge.  But the value is.  What will the effects be?

One example catches the way common sense and even logic are undermined in the world of the aerotropolis.  Roses grown in Kenya are on sale all over Europe.  Surely a gross misuse of the Earth's scarce resources.  Or maybe not - they are cheap because they grow quickly and easily in the equatorial sun without the need for the pesticides and fertilisers necessary in France or Bulgaria.  And even the low prices they command, translated into Kenyan living standards makes their growers wealthier than their neighbours growing food.  Should we begrudge the Africans an income purely for the sake of the fuel the journey to market consumes?

Kenyan Roses - A good thing or a bad thing?


Or will this be a temporary phenomena.  The book doesn't shy away from the sustainability issue.  The fact that the actual flying bit of the equation only accounts for 2% of world carbon emissions is slipped in, but the whole point of the book is that impact of air travel is much greater than just moving people from one place to another.  Widespread air travel is only possible because of cheap oil.   As the oil runs low and prices creep up, will the aerotropolis continue to be viable?  The way the energy is obtained to run the system today is unsustainable and things will have to change.  Possibly the increasing cost of fuel will choke off air travel and globalisation will go into reverse. 

But there is a lot of money involved in air based trading.  Although the actual physical volume is still trivial, the value of goods traded by air is already close to a third of the total.  So research and development into new fuel sources can be afforded.  Perhaps solar powered fermentation vats directly converting the carbon dioxide in the atmosphere back into energy rich fuels to pump into the planes will soon be another distinctive feature of the aerotropolis.  I wouldn't bet against it.  Governments around the world are betting on the aerotropolis as the motor of economic growth.  Last March the Chinese government announced plans for a second Bejing airport.  It is intended to open in 2015.  Bear in mind that the current Bejing airport has just taken over from Heathrow  as the world's second busiest airport.

A world awash with high value goods traded using feats of organisation and technology is already upon us.  The figures indicate that it is growing. What happens next?  In the late Middle Ages towns, with their concentrated wealth, came to first rival and then to overtake the feudal economy based on agriculture.  Eventually this led to the decline in power of the aristocracy and the rise of new forms of state.  Global trade was enabled by ports that allowed countries like Britain and Japan to prosper despite their lack of resources. Railways shaped whole towns and allowed suburbs to be created.

What will hugely profitably and obviously internationally focused airport complexes do to the societies in which they are growing?  What will happen to countries that don't develop an aerotropolis - are they destined for the backwaters?  And what will happen to national consciousness in a world where all the rich and successful people spend all their time travelling from one country to another.  In fact, will nation states continue to have a meaningful existence?

Aerotropolis doesn't answer these questions, but it does pose them in an engaging if slightly breathless way.  They do predict that the rise of the aerotropolis will alter the global pecking order.  That at least is likely enough.

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