Answer to Map #104

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Answer: This week’s proportional symbol map depicted the stock exchanges of the world by total capitalization.

For the most part, the world’s biggest economies each have one stock exchange where that country’s stocks are traded. Those exchanges are generally in the most important commercial cities, which are not necessarily national capitals. For example, Nigeria’s stock exchange is in Lagos, not Abuja; Brazil’s is in Sao Paulo, not Brasilia; and Germany’s is in Frankfurt, not Berlin. Rarely, as in the case of India, a country will have more than one stock exchange. The U.S. also has two, both in New York: the New York Stock Exchange and the NASDAQ.

There used to be a third stock exchange in the U.S., the American Stock Exchange, but it was purchased by and subsumed into the NYSE in 2008. The recent trend toward consolidation makes this map tricky. There is also an important stock exchange in Milan, the Borsa Italiana. But since that exchange was purchased by the London Stock Exchange in 2007, it doesn’t appear on this map. That doesn’t mean that the Borsa Italiana ceased to exist—it is still in operation—but it does mean that we can’t get specific enough statistics to put it on the map. The stock exchange statistics we used don’t list the subsidiary exchanges separately from their parent companies.

On this map, you can see how important publicly traded companies have become to the Chinese economy. There are three Chinese exchanges on this map: in Shanghai, Hong Kong, and Shenzhen. All three have interesting histories. The first stocks were traded in both Shanghai and Hong Kong in 1866, a time when Western powers were forcing China to open up to foreign investment. Since Hong Kong became a British colony, the Hong Kong Stock Exchange continued to prosper after it was formally set up in 1891. But the exchange in Shanghai was shut down by China’s Communist government until it was finally re-established in the 1980s. Today, there are severe limitations placed on foreigners who wish to trade in Shanghai. Those restrictions don’t affect Hong Kong. Shenzhen, meanwhile, is a relative newcomer. The city of Shenzhen, which is in mainland China right across from Hong Kong, wasn’t even established until 1979, when it was mostly a few rice farming villages. Today, Shenzhen is a booming metropolis of some 12 million people and one of the centers of China’s technology industry.

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