key issues where is industry distributed? why are situation and site factors important? how does...
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Key Issues Where is industry distributed? Why are situation and site factors important? How does industrialization affect the environment? Why are situation and site factors changing?TRANSCRIPT
Key Issues Where is industry distributed? Why are situation and
site factors important? How does industrialization affect the
environment? Why are situation and site factors changing? Key issue
1: where is industry distributed? Where Is Industry
Distributed?
Modern concept of industry: the manufacturing of goods in a
factory. Origin: northern England and southern Scotland in late
1700s Industrial Revolution - improvements made in industrial
technology that transformed the process of manufacturing goods.
Remember: also coincided with Second Agricultural Revolution
Industrial Revolution
Facilitated by the availability of natural resources in the hearth
countries (water power, coal, iron ore) Diffusion of industry led
to growing populations and increased food supplies (remember the
Second Agricultural Revolution!) This freed workers from farming
and caused many to seek industrial jobs in cities Increased the
demand for raw materials and the search for new markets: led to
colonialism and imperialism Diffusion of Industrial
Revolution
FIGURE 11-2 DIFFUSION OF THE INDUSTRIAL REVOLUTION The construction
of railroads in the United Kingdom and on the European continent
reflects the diffusion of the Industrial Revolution. Europes
political problems impeded the diffusion of the railroad.
Cooperation among small neighboring states was essential to build
an efficient rail network and to raise money for constructing and
operating the system. Because such cooperation could not be
attained, railroads in some parts of Europe were delayed 50 years
after their debut in Britain. Where Is Industry Distributed?
Industrial Regions Industry is concentrated in three regions Europe
North America East Asia Each region accounts for roughly of the
worlds total industrial output. Brazil and India account for most
of industrial output outside of the regions listed above Europes
Industrial Centers
FIGURE 11-3 Europes Industrial Areas Europe was the first region to
industrialize during the nineteenth century. Numerous industrial
centers emerged in Europe as countries competed with each other for
supremacy. Europe was the first region to industrialize during the
nineteenth century. Numerous industrial centers emerged in Europe
as countries competed with each other for supremacy. North Americas
Industrial Centers
FIGURE 11-4 North Americas Industrial Areas Industry arrived a bit
later in North America than in Europe, but it grew much faster in
the nineteenth century. North Americas manufacturing was
traditionally highly concentrated in the northeastern United States
and southeastern Canada. In recent years, manufacturing has
relocated to the South, lured by lower wages and legislation that
has made it difficult for unions to organize factory workers. North
Americas manufacturing was traditionally highly concentrated in the
northeastern United States and southeastern Canada. In recent
years, manufacturing has relocated to the South, lured by lower
wages and legislation that has made it difficult for unions to
organize factory workers. East Asias Industrial Areas
East Asia became an important industrial region in the second half
of the 20th century, beginning with Japan. Into the 21st century,
China has emerged as the worlds leading manufacturing country by
most measures. FIGURE 11-5 East Asias Industrial Areas East Asia
became an important industrial region in the second half of the
twentieth century, beginning with Japan. Into the twenty-first
century, China has emerged as the worlds leading manufacturing
country by most measures. Newly Industrialized Country (NIC)
A country whose level of economic development ranks it somewhere
between developing and developed (semi-periphery) These countries
have moved away from an agriculture-based economy and into a more
industrialized, urban economy. In the 1970s and 1980s, examples of
newly industrialized countries included Hong Kong, South Korea,
Singapore and Taiwan. Examples in the 2000s include South Africa,
Mexico, Brazil, China, India, Malaysia, the Philippines, Thailand
and Turkey Sectors of the economy Primary - Agriculture, fishing,
forestry, and mining Largest sector in low-income, pre-industrial
nations Secondary - Transforms raw materials into manufactured
goods Grows quickly as societies industrialize Tertiary - Involves
services rather than goods Dominates post-industrial societies
Trade, finance, real estate, government, transportation, education,
entertainment, media Offshoots of Tertiary Sector
Quaternary intellectual activities research and development,
management and administration, libraries, information technology,
government, education Quinary - highest levels of decision making
in a society or economy top executives or officials in government,
science, universities, nonprofit, healthcare, culture, and the
media The contemporary economic landscape has been transformed by
the emergence of:
Service industries High technology industries Growth poles Service
Industries In the global economic core, service industries
(tertiary, quaternary, quinary) employ more workers than primary
and secondary industries combined Quaternary and quinary have
experienced rapid growth in the last 30 years, giving greater
meaning to the word postindustrial Not all services contribute to
an economy equally Ex: you pay $20 for a haircut and $20,000 for a
surgery High-Technology Industries
Designated by government to benefit from lower taxes, with goal of
providing high-tech jobs to local population Attracts designers of
computers, telecommunications, medical equipment, etc. Examples of
high-technology corridors are Californias Silicon Valley North
Carolinas Research Triangle High-Tech Corridors Attracted by
prospect of developing links with existing research communities and
availability of a highly educated workforce Californias Silicon
Valley (UC Berkley, Stanford University) is home to Adobe, HP,
Intel, IBM North Carolinas Research Triangle (Duke, NC State, and
UNC Chapel Hill) is also home to many high-tech companies Major
Employers in NC Research Triangle
American Airlines Bayer The Body Shop Burt's Bees Duke University
DuPont Fidelity Investments General Electric GlaxoSmithKline IBM
PNC Qualcomm Quintiles Sony Ericsson Toyota Verizon Growth Poles
Growth Pole Theory: economic development, or growth, is not uniform
over an entire region, but instead takes place around a specific
pole (or cluster). This pole is often characterized by core
industries around which linked industries develop, mainly through
direct and indirect effects. Silicon Valley became a growth pole
because the concentration of businesses spurred economic
development in the surrounding area Rust Belt and Sun Belt Rust
Belt: The industrial zone of the northeasternUnited States (around
Great Lakes) used to be called the Manufacturing Belt Evokes image
of abandoned, rusted out steel factories Sun Belt: southern region
of the United States Both population and economy of this region has
grown recently as service sector businesses have chosen to locate
where climate is warm Rust Belt and Sun Belt Ecotourism Ecotourism
is defined as "responsible travel to natural areas that conserves
the environment, sustains the well-being of the local people, and
involves interpretation and education" (TIES, 2015) Helps to
protect the environment AND generate jobs Principles of
Ecotourism
Build environmental and cultural awareness and respect. Provide
direct financial benefits for conservation. Generate financial
benefits for both local people and private industry. Help to raise
sensitivity to host countries' political, environmental, and social
climates. Design, construct and operate low-impact facilities. Work
in partnership with indigenous people to create empowerment for
them. National Geographics Top 10 Ecotourism Destinations:
Brazil Dubai Canada Belize Kenya Gabon Laos Ireland Turks and
Caicos Greece Webers Model of Industrial Location
Alfred Weber 1909 Germany Also called the Least Cost Theory
Explains the location of industries in terms of 3 factors:
Transportation cost of moving raw materials to factory and finished
products to market Labor Cheap labor may allow an industry to make
up for higher transportation costs Agglomeration if several
industries cluster in one city, they can share talents, services,
and facilities Webers Model The substitution principle states that
business owners can juggle expenses as long as labor, land rent,
transportation, and other costs dont all go up at once Need to find
the sweet spot that is best for the company financially The sweet
spot can move depending on the variables Ex: Nike pays extra for
transportation in exchange for cheap labor overseas Webers
Industrial Least Cost Model
Labor Sweet spot Agglomeration Transportation Key issue 2: why are
situation and site factors important? Situation and Site
Factors
Geographers attempt to explain why one location may prove more
profitable for a factory than others. Companies ordinarily face two
geographic costs. Situation factors costs associated with the
established transportation networks accessible from a specific
place. The farther something is transported, the more it costs Site
factors costs resulting from the unique characteristics of a
location. Labor, capital, and land vary by location Situation
Factors Two main situation factors:
Proximity to Input: optimal plant location is near the raw
materials This is best when raw material transportation costs are
greater than transportation costs of product to consumer When raw
materials cost more than final product, it is called a
bulk-reducing industry Examples: lumber turned into paper, raw
metals (copper, steel) being turned into lighter finished products
2. Proximity to Market: the optimal plant location is as close as
possible to the customer
This is best when the cost of transporting raw materials is less
than the cost of transporting the product to consumers When the
final product weighs more or takes up more space than the raw
materials, it is called a bulk-gaining industry Examples: beverage
bottling, automobile assembly, potato chips Exception: wine is
bottled near the raw materials (grapes) because grapes are very
fragile Manufacturers may also prefer proximity to market if:
They are a single-market manufacturer with only one or two
customers A manufacturer or buttons, zippers, etc. makes sense to
be located close to a garment factory (its customer) They have
perishable products Bread bakers, milk bottlers, newspaper printers
Bulk-gaining: Beverage Production
Figure 11-9 BULK-GAINING: BEVERAGE PRODUCTION Beer is a
bulk-gaining industry. The cans or bottles are filled mostly with
water. Most beer is bottled near major metropolitan areas, where
most of the consumers are clustered add to caption: The areas in
color on the map have relatively high population density. Beer is a
bulk-gaining industry. The cans or bottles are filled mostly with
water. Most beer is bottled near major metropolitan areas, where
most of the consumers are clustered Perishable Products FIGURE
PERISHABLE PRODUCTS Potato chips are best consumed when fresh, and
they are much bulkier after they have been sliced, fried until they
curl, and placed in large air-filled bags. As a result, most are
produced relatively close to the market. Potato chips are best
consumed when fresh, and they are much bulkier after they have been
sliced, fried until they curl, and placed in large air-filled bags.
As a result, most are produced relatively close to the market.
Footloose Industries For some businesses, transportation costs are
not a factor Footloose industries that can locate anywhere and be
profitable Examples: Call centers Credit card processing centers
Online companies Alternative example: both parts and finished
products in the computer industry are expensive, so transportation
costs are only a small part of total production costs Why Are
Situation and Site Factors Important?
Site Factors: Labor, Capital, and Land 1. Labor Most important
factor on a global scale. Minimizing labor costs, which vary around
the world, is extremely important to some industries. A
labor-intensive industry is an industry in which wages and other
compensation paid to employees constitute a higher percentage of
expenses. Example: it costs more to make a car but is less labor
intensive than making a t-shirt (where a large percentage of the
cost of production is labor) Why Are Situation and Site Factors
Important?
2. Capital Manufacturers typically borrow the funds needed to
establish new factories or expand existing ones. Ability to borrow
money has greatly influenced the distribution of industry in
developing countries. 3. Land Must consider natural resources,
human resources, and the actual land itself Modern factories are
most efficient when they are in one-story buildings (need more
space) Mostly available in suburban and rural locations and tends
to be relatively cheaper than land in the city. Basis for Trade
Comparative advantage: the competitive edge enjoyed by one location
over another Ex: places with favorable growing conditions and
inexpensive labor will become specialized in the production of
something like bananas Some locations begin to specialize in one
economic activity and exchange goods with other regions.
Complementarity: the degree to which one place can supply what
another place demands Ex: Florida has a high degree of economic
complementarity with northeastern U.S. because it can supply fresh
fruits and vegetables year-round Challenges for Developed
Countries
Protection of markets from new competitors can be a challenge
Competition now occurs more frequently within regional trading
blocs (free trade zones within a region no tariffs or barriers to
trade among member countries) Three most important trading blocs:
North America (NAFTA U.S., Canada, Mexico) European Union (EU) East
Asia no formal organization, but Japanese companies play leading
roles in the economies of other countries in the region Trading
Blocs Free trade zones - free movement of products across borders
in these regions has led to closer integration of industries within
North America and within Europe Example: parts of cars are made in
different countries within the bloc and moved easily across borders
Competition among blocs: trade barriers like taxes, lengthy permit
procedures, and quotas on exports have been placed between blocs
Ex: Japanese government maintains quotas on the number of cars
Japanese companies can export to the U.S. Problems within blocs In
the EU industry is concentrated in Germany, France, and UK Within
those countries, some areas are more industrialized (and thus
richer) than others France most industry and wealth are around
Paris Germany eastern part lags far behind the west Within NAFTA,
Mexicos economy lags behind those of the U.S. and Canada
Transnational Corporations
Most cooperation and competition within and among trading blocs
takes place through transnational corporations companies that
operate factories in countries other than the ones in which they
are headquartered Most transnational corporations are headquartered
in the U.S., but some are located in Japan or Europe Transnational
Corporations Outsourcing Where to produce or assemble a product is
only a small aspect of the commodity chain A large part of business
decision making today has to do with where to have parts produced
and assembled Outsourcing a company moving production or services
abroad Gained a negative connotation as people felt American jobs
were moved elsewhere Media focused on outsourcing of jobs to China
and call centers to India Outsourcing Today, globalization has
deepened and created a new world economy Outsourcing is now an
umbrella term for globalized production in which a defined segment
of the commodity chain is performed abroad Regardless of where
goods are produced, consumption is still concentrated in the core
countries and wealthy and middle classes of the semi-periphery
countries of the world Top 5 U.S employers in India:
General Electric: 17,800 employees Hewlett-Packard: 11,000
employees IBM 6,000 employees American Express 4,000 employees Dell
3,800 employees Typical salary for a computer programmer: U.S. -
$70,000 India - $8,000 Challenges for Less Developed
Countries
LDCs face the challenge of reducing inequality in wealth between
them and MDCs Problems they encounter: Distance from markets
wealthy consumers in MDCs are generally far away need to invest a
lot in transportation Inadequate infrastructure lacking in
transportation, communication, equipment, and also schools and
universities to educate workers, managers, and executives
Competition companies seek out low-cost labor in LDCs but keep
highly skilled jobs in MDCs New International Division of
Labor
Also known as global division of labor Reorganization and
relocation of jobs from a national to a global scale Selective
transfer of production operations requiring highly skilled workers
to factories located in MDCs and those requiring little skill to
factories located in LDCs New International Division of Labor
Key features: Dependence on the core (MDC) countries on lower-cost
production from the LDCs for mass-produced goods Transportation
efficiency leads to separation of producers and consumers Locations
are selected that have lower operating costs Specialized jobs are
contracted to companies or specific locations New International
Division of Labor
Impacts on the United States: Unemployment Deindustrialization
restructuring toward tertiary/quaternary job sectors Migration from
areas of unemployment to areas of employment (Rust Belt to Sun
Belt) Availability of less-expensive goods changes the standard of
living New International Division of Labor
Impacts on developing countries such as Mexico, China, and India:
Added job opportunities Entry of women into the workforce Child
labor Increased wage gap Migration Pollution Regional growth and
concentration of wealth, pollution, etc.
Westernization/globalization effects on society and culture of
region U.S. Clothing Manufacturing
FIGURE U.S. CLOTHING The percentage of clothing made in the United
States declined from around 50 percent in the 1990s to around 2
percent today. Key issue 3: how does industrialization affect the
environment? Natural Resources The shift from wood to coal as the
leading energy source in North America and Western Europe lessened
deforestation Began depletion of coal, petroleum, and natural gas
Population growth has added to the problem Energy use in MDCs is
far greater than in LDCs MDCs contain 25% of worlds people but
consume about 75% of worlds fossil fuels The U.S. burns 25-40% of
the world's energy but only has 4.6% of the world's population Top
consumers of oil U.S. 20,700,000 barrels/day
China 6,500,000 barrels/day Japan Germany Russia India Canada South
Korea Brazil France Sustainable Development
Basic idea: People living today should not impair the ability of
future generations to meet their needs Possible solutions to
environmental problems: Prevention limit population growth or use
of resources Technological change installing filters for industrial
runoff and recycling industrial waste Mitigation reverse damage,
ex: clean up chemical spills Compensation hold companies legally
responsible for damages or illnesses caused Industrial Pollution
Industrial development has greatly increased air, water, and land
pollution Global warming increase in earths temperature caused
primarily by the burning of fossil fuels Greenhouse effect carbon
dioxide in atmosphere traps heat- could melt polar ice caps and
raise level of oceans Consequence: destruction of coastal cities
and massive migrations inland Acid rain causes corrosion of
buildings, kills fish, stunts growth of forests, harms crops Key
issue 4: why are situation and site factors changing? Why Are
Situation and Site Factors Changing?
Changes within Developed Regions Shifts within the U.S.
Northeastern U.S. lost 6 million jobs in manufacturing between 1950
and 2010 2 million jobs were added in the South and West California
and Texas had largest increases Industrialization during the late
19th and early 20th centuries largely bypassed the South, because
they lacked the needed infrastructure (had not recovered from
losing Civil War) In a closed shop a company and the union agree
that everyone must join the union to work in the factory. In an
open shop a union and a company may not negotiate a contract that
requires workers to join a union as a condition of employment.
Right-to-work laws send a powerful signal that antiunion attitudes
will be tolerated and perhaps even actively supported More
recently, manufacturers have been lured to the south by
right-to-work laws - legislation that requires a factory to
prohibit workers from being forced to join a union. Essentially,
industry in the U.S. over time has shifted from the Northeast
toward the South and West. Steel, textiles, tobacco, and furniture
industries have become dispersed through smaller communities in the
South Many people in South will work for lower wage and forego
joining a union Gulf Coast has access to oil and natural gas
Changes in U.S. Manufacturing
FIGURE CHANGING U.S. MANUFACTURI NG Manufacturing has decreased in
the Northeast. Interregional Shifts in Europe
Manufacturing has diffused from traditional industrial centers in
northwestern Europe toward Southern and Eastern Europe European
government policies have encouraged this relocation because incomes
in Southern and Eastern Europe lag behind Europes average Emerging
Industrial Regions
In 1970, half of world industry was in Europe and 1/3 was in North
America Today, these regions account for only each Industrys share
of total economic output has steadily declined in MDCs since the
1970s Labor-intensive industries have been especially attracted to
emerging industrial regions Manufacturing Value as a % of GNI
FIGURE MANUFACTURING VALUE AS A PERCENTAGE OF GNI Manufacturing has
accounted for a much higher share of GNI in developing countries
than in developed countries since the 1990s. Mexico and NAFTA NAFTA
eliminated most barriers to moving goods among Mexico, the U.S.,
and Canada since 1994. Mexico attracts labor-intensive industries
because of its relatively low-cost labor and its proximity to the
U.S. Plants in Mexico near the U.S. border are known as
maquiladoras. Companies receive tax breaks if they ship materials
from the U.S., assemble components in Mexico, and export finished
product back to U.S. Special Economic Zones (SEZ)
Designated areas in countries that possess special economic
regulations that are different from other areas in the same
country. Conducting business in a SEZ usually means that a company
will receive tax incentives,lower tariffs, or eased environmental
restrictions China has been the most successful in using SEZs allow
foreign companies to have free trade rights and to outsource China
has even declared an entire province (Hainan) to be an SEZ Most
SEZs are cities BRICS The countries expected to dominate global
manufacturing during 21st century: Brazil, Russia, India, China
These four control 25% of the worlds land area and contain 3
billion people Account for only 1/6 of the world GDP China is
expected to pass the U.S. as the worlds largest economy around 2020
South Africa was added to the acronym in 2010 GDP for BRIC
Countries By 2050, the worlds largest economies are expected to be
held by:
China India United States Indonesia Nigeria Brazil Russia Women in
Industry Changes in the global economy have resulted in a rapid
increase in the number of women engaged in industrial employment in
LDCs Women are paid lower wages than men for the same work (even in
developed countries like the U.S.) Women are often required to work
in addition to their family responsibilities Women work longer
hours than men in every country except the U.S., Canada, and
Australia (including paid and unpaid labor) Women in Industry
Increased job opportunities for women have led to better
healthcare, education, an childcare for women worldwide Women are
40% of worlds workforce but have just 1% of its wealth Women
account for 58% of unpaid labor worldwide 552 million women joined
the global labor force between 1980 and 2008 Globally, 4 out of
every 10 workers is a woman The feminist movement of the 1960s led
the way for women to increase their presence in almost all
occupations in the Western world. Over the subsequent decades, U.S.
women had higher labor participation rates than most other
developed countries. Seven decades since the end of World War II,
is that statement still true? A. Yes, the United States still
leads. B. Not quite, but it is still near the top. C. No, it is in
the middle of the pack. D. No, it is near the bottom.