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Unit 6: Industrialization and Development 1 Key Concepts Industrialization and the Environment Growth and Diffusion of Industry Industrialization The Evolution of Economic Cores and Peripheries Global Inequalities Contemporary Patterns 2 Part One: Key Concepts 3 A) Introduction 4 What is economic geography? 5 Economic Geography studies the impact of economic activities on the landscape and investigates reasons behind the locations of economic activities. 6 Agriculture Others Industry Economic Geography International Trade Transport and Communication Resources 7 A Day in the Life What might an average worker be doing on an average day in the Spring of 1553? 8 A Day in the Life What might an average worker be doing on an average day in the Spring of 1893? 9 A Day in the Life What might an average worker be doing on an average day in the Spring of 1973? 10 A Day in the Life What might an average worker be doing on an average day in the Spring of 2012? 11 What is industrialization? 12 Industrialization is the process by which economic activities evolved from producing primary goods to factories that mass-produce goods. 13 Agriculture Primary Economic Activity VS. Secondary Economic Activity Industry 14 Primary Sector Secondary Sector Tertiary Sector Quaternary Sector 15 Primary Sector •Agriculture •Animals •Fishing •Forestry •10,000 Years Secondary Sector •Petroleum •Metals •18th Century Tertiary Sector •Services •Post-Industry •Late 20th Century Quaternary Sector •Research •Administration 16 Societies PreIndustrial Most Countries Industrial Some Countries Post Industrial Few Countries 17 What is the difference between an LDC and MDC? 18 Less Developed Countries have not developed industry. More Developed Countries are often post-industrial countries. 19 20 B) Economic Indicators of Development 21 What is Gross Domestic Product? 22 Gross Domestic Product is the value of the total output of goods and services produced in a year. 23 US GDP: 14,526,550 Million Dollars 24 Per Capita GDP GDP / Total Population US Per Capita: $48,800 25 How MDCs and LDCs Differ: GDP Types of Jobs Productivity Raw Materials • $20,000 in MDC • $1000 in LDC • MDC – Fewer Primary Sector • LDC – More Primary Sector • Value Added Per worker is higher in MDCs • MDCs have greater access to Raw Materials Consumer Goods • MDCs can afford Consumer goods and have more access to them. Economic development is often accompanied by social development. 26 C) Theories of Economic Development 27 What is the Modernization Model 28 The Modernization Model says that the Industrial Revolution was spurred by a combination of prosperity, trade connections, inventions, and natural resources. 29 Western European Nations and the US followed Britain Britain Industrializes Wealth became a sign of virtue instead of kinship. 30 A few key points: • According to the M.M., any country can reap the benefits of modernization. • Tradition is the greatest barrier to economic development. 31 A few key points: • Culture can discourage people from adopting new technologies that would raise standards of living. • High-Income countries can help poorer countries by encouraging them to control population, increase food production, and take advantage of industrial technology. 32 Rostow’s Stages of Development 33 High Mass Consumption • Industry expands. • Luxury items become necessities. • High Incomes, a majority of workers involved in the service sector. Drive to Technological Maturity • Economic growth is widely accepted. • The economy diversifies. • Poverty is greatly reduced and material goods much more common. • Cities grow, and modernization is evident in the core. • International trade expands. Take-Off Stage • People begin to experiment with producing goods for trade with others for profit. • A state industrial revolution takes place. • Urbanization, technology, and production increases. Traditional Stage • Life is built around families. • Very Limited Wealth. • Subsistence Farmers. 34 Rich nations often block the path of poor. A justification for capitalism to exploit noncapitalism. Criticisms Suggesting that poverty is the fault of the victims is wrong. Poorer nations have to develop from a position of weakness. 35 What is Dependency Theory 36 Dependency Theory says that the economic development of many countries is blocked by industrialized nations that exploit them. 37 A Few Key Points. • Dependency theory blames MCDs that control or who once controlled LDCs through colonialism. • Argues that political liberation from colonialism has not translated into economic health. • Dependency theory is largely an outgrowth of Marxism. 38 Wallerstein’s Capitalist World Economy Model 39 Core Countries • Rich nations that fuel the world’s economy. • Take raw materials from around the world and channel them to North America, Europe, Australia, and Japan. Periphery Countries • Low-Income countries brought about through colonialism. • Support rich countries by providing inexpensive labor and a large market for industrial products. Semiperiphery Countries • The rest of the world. • More powerful than periphery, but still dominated in some way by the core. 40 41 Treats wealth as a “0 Sum Theory” Ignore cultural issues that affect poverty. Criticisms Places blame on countries that have helped others. No country willingly blocks another from success. 42 Part Two: Growth and Diffusion of Industrialization 43 A) Before the Industrial Revolution 44 Before the Industrial Revolution There were industrial centers before the late 18th Century but it was isolated. Most industries were cottage industries. Examples: Chinese Silk Factories Metal Workshops in India 45 What is a cottage industry? 46 Cottage Industries are homebased manufacturers where people manufacture tools and agriculture equipment for their own communities. 47 B) The Start of the Industrial Revolution 48 The Early 18th Century Early factories in Great Britain during the 18th Century were run by water running down slopes. 49 The Most Important Invention In 1769, James Watt built the first efficient steam engine. This was the most important invention to the Industrial Revolution. 50 What is the Industrial Revolution? 51 The Industrial Revolution was the process of technological change that started in the late 1700s that transformed how goods were produced and obtained by the people. 52 Social Changes Population Changes Effects of the Industrial Revolution Economic Changes Political Changes 53 Iron Food Processing Coal Industries affected by the Industrial Revolution Transportation Chemicals Textiles 54 C) Diffusion of the Industrial Revolution 55 Great Britain Diffusion of the Industrial Revolution Belgium/France (late 1700s) The United States (1790s) Most of Europe came late to the party because of revolution and strife (ie. French Revolution, Napoleonic Wars) Italy, Netherlands, Russia, Sweden (late 1800s) The United States entered the IR later than Belgium and France but expanded more rapidly. The Middle East and Africa entered the IR because of WWI and the need for oil. Asia, Middle East and Africa (Mid 20th Century) 56 Part Three: The Evolution of Economic Cores and Peripheries 57 A) Introduction 58 Why do you think that some places were affected by industrialization while others were not? 59 Location Theory Locational Independence Theory 60 A) Location Theory 61 What is Location Theory? 62 Location Theory explains the locational pattern of economic activities by identifying factors that influence this pattern. 63 Primary Industry • Develops around natural resources. Secondary Industry • Develops as transportation improves. • Less dependent on location 64 Variable Costs Secondary Industry Locations Distance Decay Friction of Distance 65 Core • Primary and Secondary Industries Semi-Periphery • Secondary Industries Periphery • Neither 66 What is the Least Cost Theory? 67 Alfred Weber’s Least Cost Theory is a theory that explains the location of industries based on transportation, labor, and agglomeration. 68 Transportation The site chosen must entail the lowest possible cost of A) moving raw materials to the factory, and B) finished products to the market. 69 Weight (Bulk) Gaining • Soft Drink Manufacturing Weight (Bulk) Losing • Copper • Timber • Most Agriculture 70 71 Location Triangle The location triangle is used to determine the best place to locate a manufacturing plant based on Weber’s Model. Resource 2 Market Resource1 72 73 A) Least Cost Theory Continued 74 I am the CEO of a rubber company looking for a place to locate my new plant which will purify petroleum into the rubber products before sending it on to Houston, Texas for further processing. I import petroleum from the Middle East. A Case Study 75 What is the Break of Bulk Point? 76 The Break of Bulk Point is where the transfer of goods among transportation modes is possible. 77 Product per Case Cost/Rail Cost/Road Fuzzy Mice .05 .01 Concrete 1.00 2.00 Oil .50 .60 Town 10M 11M 5M 6M Resource 1 3M Resource 2 78 What is the Location Interdependence Theory? 79 Location Interdependence Theory is a theory that explains the location of industries based on the location of their competition. 80 Variable Revenue Analysis The ability of a firm to capture a market that will earn it more money and customers than the competition. 81 The Beach How would Locational Inderdependence Theory play a part in where A and C would choose to locate? 82 Situation Factors •Transportation Issues •Bulk-Gaining, Bulk Losing Site Factors •The cost of Land, Labor, and Capital •Climate •Access to Amenities 83 Part Four: Contemporary Patterns in Industrialization 84 A) Globalization and Infrastructure 85 How Does Globalization Affect Industrialization? • Every country’s development is dependent on the rest of the world. – With the increase of Space-Time Compression, it is possible to locate businesses in places not before considered. – The Internet has made it possible for markets to exist where they have not before. – In order to accommodate global industrialization a country must develop infrastructure. 86 What is infrastructure? 87 Infrastructure includes services that support economic activities. It provides for transportation, communication, education, and other external needs of a company. 88 B) Primary Industrial Regions 89 Western and Central Europe Eastern Asia Primary Regions Eastern North America Russia and the Ukraine 90 Western and Eastern Europe • Expanded greatly after WWI. • Was largest in Germany until WWII. • Rebuilt with the help of America after WWII. North America • The North American Manufacturing Belt extends from Boston and New York through Philadelphia and Baltimore. • The Southeastern District: Birmingham, Alabama to Richmond, Va. • Another: Oklahoma to Dallas, Houston, and New Orleans. • Northern California: San-Fransisco • Southern California: Los Angeles to San-Diego • Pacific Northwest: Portland, Oregon through Seattle, Washington and Vancouver in Canada. 91 92 Russia and the Other Soviet Republics • Much manufacturing up through the 1930s followed the Volga River. • Other regions followed the Trans-Siberian Railroad. 93 94 Asia The Four Tigers (Export Oriented Industrialization) Japan • The Kanto Plain • Tokyo • • • • South Korea Taiwan Hong Kong Singapore China • Northeast District in Manchuria • Beijing, Shanghai, Hong Kong • The Pacific Rim 95 C) Secondary Industrial Regions 96 Southeast Asia Northern Africa Secondary Industrial Regions Mexico Brazil 97 What is the maquiladora? 98 The Maquiladora is a manufacturing zone created in the 1960s in Mexico that mostly produces American products. 99 What is the NAFTA? 100 NAFTA is the North American Free Trade Agreement which eliminated barriers to free trade in North America. 101 Part Five: Global Inequalities 102 A) Challenges for More Developed Countries 103 Protection of Markets MDCs are having to work to protect their markets from newly developing countries. They often do this by establishing Trading Blocs. 104 What is a trading bloc? 105 A Trading Bloc is a conglomeration of trade between regions. 106 Little to No Taxes Benefits of Trading Blocs Cooperation Encouraged Ease in crossing borders 107 NAFTA 3 Important Blocs East Asia European Union 108 Most cooperation and competition between trading blocs take place between transnational corporations which are also conglomerate corporations 109 Deindustrialization In many MDC economies, tertiary development is replacing secondary development. Growth of LDC industry is taking jobs away from MDCs. This is a natural progress of society. Service jobs is the mark of a developed society. 110 B) Challenges for Less Developed Countries 111 Distance from Market Challenges of LDCs Competition with Existing Manufacturers Inadequate Infrastructure 112 The New International Division of Labor The selective transfer of some jobs to LDCs. 113 Part Five: Globalization and the Environment 114 Industrialization and Fossil Fuels As more and more countries become revolutionized, the need for fossil fuels grows exponentially. While we know how many proven reserves we have, we do not know how many potential reserves we have. ¼ of the world’s population consumes ¾ of the world’s fossil fuels. 115 Environmental Impact Concerns Global Warming Acid Rain 116 Prevention Compensation Solutions Technological Change Mitigation 117 The End. 118