Little, Brown £18.99

Made In Britain, By Evan Davis

The more we make, the less we know

Here's an old trick that never loses its fascination. Look around you.

Think about the things you own or use. How many are British? The Honda Civic in the drive? Made in Swindon, as it happens. The Apple iPhone in your pocket? Made in China, designed in California, but the chips made in China are under licence from ARM Holdings of Cambridgeshire. Your tea-time treat of a Cadbury chocolate bar? Made in Bournville, Birmingham, but by the Illinois-based transnational Kraft, which recently took over Cadbury.

Years ago, as Evan Davis argues, things were simpler. If you bought one of the first Honda Civics imported into the UK in 1972, you could be fairly sure that it was 100 per cent Japanese. Your (fixed-line) phone would have been assembled at a Post Office factory in South Wales, from British components. Cadbury Schweppes was a proudly British firm that aspired to world leadership. "Off-shoring" was unthinkable.

Globalisation has changed all that, and the rise of China in particular made us more nervous about our future. Davis tries hard to offer reassurance about the sometimes bewildering pace of change. For Britain has won as well as lost, as the success of McLaren racing cars, Brompton bicycles, BAE Systems, ARM and Inmarsat (tops for satellite-phone technology) all demonstrate.

Davis's argument is that Britain has lots of creative, clever people educated at excellent universities, and they are better off applying themselves to the supply of the high-value goods and services that the world wants, and leaving the T-shirts and tellies to places where wage costs can never be beaten. If the Chinese eventually catch up in hi-tech then we just migrate elsewhere, as we always have. And the Chinese may well, one day, challenge us in aerospace, pharmaceuticals, chip design and £1m supercars.

In one of those nuggets that Davis is good at chucking in – he has a chatty, broadcaster's style of writing – he tells us that in 1983 the average Chinese citizen had a standard of living equivalent to the average Briton at the start of the 17th century. In the decades since, they have made the same progress that took us 200 years. It is not that much of a stretch, then, to imagine them making a jet engine to rival Rolls-Royce's product.

Yet we need not fear that. Davis rightly points out the fallacy of extrapolation – that if the Chinese economy is growing at 10 per cent a year now, it will do so for ever. He demonstrates how every economy has to adapt, and how you can lose manufacturing jobs while making higher-value things and growing more prosperous in the process.

But I wonder. For me, it is still perfectly rational to foresee a world turned upside down in, say, 2100, where the relative living standards of the West and today's emerging economic superpowers – China, India and Brazil – are reversed. Despite enjoying Davis's lively, upbeat account of the way we make our living, I'm not at all reassured about that.

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