Unit VI: Industrialization and Economic Development

Chapter 9 Development Chapter 11 Industry Chapter 12 Services

Chapter 11: Industry VI. Industrialization and Economic DevelopmentThis section of the course presents the geographic elements of industrialization and economic development, including past and present patterns of industrialization, types of economic sectors, and how places acquire comparative advantage and complementarity. Students also learn how models of economic development, such as Rostow’s stages of economic growth and Wallerstein’s World Systems Theory, and programs like the Millennium Development Goals help to understand why the world is divided into a more-developed economic core and a less-developed periphery.

Measures of development (e.g., gross domestic product [GDP] per capita, the Human Development Index [HDI], the Gender Inequality Index [GII], and the Gini coefficient) are tools to understand patterns of economic differences. The analysis of contemporary patterns of industrialization and their impact on development is the third major theme of this section. Topics to be studied include Weber’s industrial location theory and accounts of economic globalization, which accent time–space compression and the international division of labor. As an example, students study the reasons why some Asian economies achieved rapid rates of growth in the mid- to late 20th century, whereas most sub-Saharan African economies did not. In addition,students need to understand patterns of economic growth and deindustrialization in a region such as in North America, where the emergence of service sectors, high technology, and growth poles (e.g., Silicon Valley, the Research Triangle, universities, and medical centers) is transforming the contemporary economic landscape.

Countries, regions, and communities must confront new patterns of economic inequity that are linked to geographies of interdependence in the world economy, including global financial crises, the shift in manufacturing to newly industrialized countries (NICs), imbalances in consumption patterns, and the roles of women in the labor force. Communities also face difficult questions regarding raw material, energy use, the conservation of resources, and the impact of pollution on the environment and quality of life.

A. Growth and diffusion of industrialization1. The changing roles of energy and technology2. Industrial Revolution3. Models of economic development: Rostow’s Stages of Economic Growth and Wallerstein’s World Systems Theory4. Geographic critiques of models of industrial location: bid rent, Weber’s comparative costs of transportation and industrial location in relation to resources, location of retailing and service industries, and local economic development within competitive global systems of corporations and finance

B. Social and economic measures of development1. Gross domestic product and GDP per capita2. Human Development Index3. Gender Inequality Index4. Income disparity and the Gini coefficient5. Changes in fertility and mortality6. Access to health care, education, utilities, and sanitation

C. Contemporary patterns and impacts of industrialization and development1. Spatial organization of the world economy2. Variations in levels of development (uneven development)

3. Deindustrialization, economic restructuring, and the rise of service and high technology economies4. Globalization, manufacturing in newly industrialized countries (NICs), and the international division of labor5. Natural resource depletion, pollution, and climate change6. Sustainable development7. Government development initiatives: local, regional, and national policies8. Women in development and gender equity in the workforce

Vocabulary: SharmaDevelopment

Agricultural labor force Calorie consumption Core-periphery model Cultural convergence Dependency theory Development Energy consumption Foreign direct investment Gender Gross domestic product (GDP) Gross national product (GNP) Human Development Index Levels of development Measures of development Neocolonialism Physical Quality of Life Index Purchasing power parity Rostow, W. W. “Stages of Growth” model Technology gap Technology transfer Third World World Systems Theory

Industrialization Acid rain Agglomeration Agglomeration economies Air pollution Aluminum industry (factors of production, location) Assembly line production/Fordism Bid rent theory Break-of-bulk point Canadian industrial heartland Carrier efficiency Comparative advantage Cumulative causation Deglomeration Deindustrialization Economic sectors Economies of scale Ecotourism Energy resources Entrepôt Export processing zone Fixed costs Footloose industry Four Tigers Greenhouse effect Growth poles Heartland/rimland Industrial location theory Industrial regions (place, fuel source, characteristics) Industrial Revolution Industry (receding, growing) Infrastructure International division of labor Labor-intensive Least-cost location Major manufacturing regions Manufacturing exports Manufacturing/warehouse location (industrial parks, agglomeration, shared services, zoning, transportation, taxes, environmental considerations) Maquiladora Market orientation Multiplier effect NAFTA Outsourcing Ozone depletion Plant location (supplies, “just in time” delivery) Postindustrial Refrigeration Resource crisis Resource orientation

Special economic zones (China) Specialized economic zones Substitution principle Threshold/range Time-space compression Topocide Trade (complementarity) Transnational corporation Ubiquitous Variable costs Weber, Alfred Weight/bulk-gaining Weight/bulk-losing World cities

Kuby Terms

Rubenstein 10th Edition Chapter 11 TOC

Chapter Outline Introduction. Geographers are interested in studying industry because the choice of location of an industry is fundamentally about spatial relationships among raw materials, markets, and site factors.

Case Study: Maquiladoras in Mexico. The case study describes the work of Edi Bencomo assembling auto parts. Factories locate just south of the U.S. border to take advantage of low wages.

Key Issue 1. Where Is Industry Distributed?

Origin of Industry. Industry originated in the Industrial Revolution, a technological transformation of production and transportation associated with abundant power from steam engines.

Industrial Regions. Industry is concentrated in Europe, North America, and East Asia. European industrial areas tend to be located in regions with abundant energy, raw materials such as iron ore, and labor concentrations. North American industrial areas are located in a band from the Great Lakes to the East Coast and the California Coast. East Asia’s industrial areas are in China along the coast and in Japan.

Key Issue 2. Why Are Situation Factors Important?

Proximity to Inputs. Industries where the product is cheaper to transport than the raw materials are bulk-reducing industries. To save on transportation costs they located closer to inputs than to markets. Examples include copper production and early steel production. Steel production has changed to reflect an increased emphasis on the availability of scrap metal and proximity to markets.

Proximity to Markets. When products are more expensive to transport than the inputs, bulk-gaining industries tend to locate closer to markets to minimize transportation costs. Examples include beer production, soft-drink bottling, and fabricated metals.

Contemporary Geographic Tools: Honda Selects a Factory Location. Honda based the location of its new factory on the desire to minimize shipping costs of new vehicles, minimize the shipping costs of inputs, and access to inexpensive labor.

Ship, Rail, Truck, or Air? Shipping costs are variable depending on the mode of transport used. Long-distance shipping is the least expensive shipping option. Industries which use a number of different shipping modes tend to locate at break-of-bulk points, where it is easy to repackage products and change the shipping method.

Key Issue 3. Why Are Site Factors Important?

Labor. The price and relative skill level of labor is important to industrial location decisions. Industries that have a greater percentage of their production expenses in labor are labor-intensive industries and receive the greatest benefit from paying less per hour for the same skill level of work. The textile industry is an example of a labor-intensive industry.

Land. Rural sites are more attractive to industries than before, which once located in cities for access to labor and markets. Rural land is cheaper and better accommodates large one-story factories. Ideal sites are close to major highways. Some locations may have more desirable environmental attributes, like a favorable climate or inexpensive electricity.

Capital. Not all sites have equal access to sources of funding. An example is the tendency of high-tech firms to locate in Silicon Valley for access to business loans.

Key Issue 4. Why Are Location Factors Changing?

Attraction of New Industrial Regions. Industry is shifting to new areas within MDCs. In the U.S. it is shifting south- and westward, especially because of the attraction of right-to-work laws in Southern states that limit the power of unions. In Europe it is shifting to Eastern Europe, Spain, Portugal, and southern Italy and Greece through the encouragement of EU policy.

Internationally, industrial regions outside of North America and Europe are growing as production shifts from MDCs to LDCs, especially in East Asia, South Asia, and Latin America. Two examples are the shifts in steel production and the textile industry.

Not all industrial jobs are equally likely to move internationally. Transnational corporations separate and outsource production steps that low-paid, low-skilled workers can perform while keeping other elements of production in the MDC. This phenomenon is called the new international division of labor.

Global Forces, Local Impacts: What Is an American Car? Automobiles labeled as domestic still contain a significant percentage of foreign-made parts. The definition of domestic vs. foreign is complicated, as firms like Honda and Toyota have levels of U.S. content similar to U.S. brands.

Renewed Attraction of Traditional Industrial Regions. Some industries remain in traditional regions because of their need for highly skilled labor and flexible work forces. An example is Toyota’s lean production approach. Another factor favoring location in traditional industrial regions is the adoption of just-in-time delivery manufacturing, where components are delivered exactly as they are needed, reducing a firm’s inventory expense.

Challenges to Comprehension Other “Industries” Similar to the confusion over the meaning of “state,” students may have heard “industry” used in more general terms than the text’s strict definition. For clarity, simply explain that industry applies only to the manufacturing of goods of some sort, and doesn’t include the following “industries:”

The recreation industry The restaurant industry The hospitality industry The travel industry

Site vs. Situation Factors Students usually grasp the reasons for an industry locating close to inputs vs. close to markets—but then they forget these reasons for industrial location as soon as they learn about site factors, or confuse the two.

The review questions below may help students to distinguish between these issues: sometimes site factors are so overwhelming that situation factors are ignored, and vice-versa. In other cases a combination of site and situation factors may be at play.

FRQs Associated with Industrialization

Review/Reflection Questions

1. Name some industries local to our town. Identify and explain the situation and site factors involved in each industry’s location.

2. Now pick an industry and describe how its closing would affect the town’s economy. Would the jobs lost in the closing be the only effects? Explain.

3. Give an example, not from the text, of an industry that is likely to locate closer to inputs, and explain.

4. Give an example, not from the text, of an industry that is likely to locate closer to markets, and explain.

5. If industrial location is chosen according to situation factors in order to minimize transportation costs, explain why many industries are locating in Southeast Asia and shipping goods to markets in North America.

6. Given current trends in the movement and growth of industry, is industry likely to remain important as a source of employment in our country? Why or why not?

7. Discuss the impact of new inventions on the distribution of industry.

8. How is outsourcing changing the distribution of manufacturing?

9. How are just-in-time delivery methods more subject to disruptions?

10. Outline the major site and situation factors which affect industrial development.

11. Why is China one of the world's most important industrial producers?

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Top Ten Terms: Instructions: Look at each of the terms associated with this chapter/unit. Determine which are the most important and define each in your OWN words if possible. Some chapters may have more than ten terms that are critical. Use the back of this page to add any extra terms.

Top Ten Terms Definitions

Models and Theories:On the back or an extra sheet of paper, list all models and theories associated with this chapter/unit. Draw any diagrams as needed (e.g. von Thünen model, Demographic Transition, etc.) Be sure to label each.

Key Terms by Key Issue

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Quick Snicker Outline by Key Issue

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Key Issue SummariesSummarize each Key Issue in your OWN words

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Key Graphics, Maps, and Charts

List the key graphics, maps, and charts found in this chapter. Put the figure number, page, and your interpretation of it.Fig. # Page # Description/Interpretation

Case Study Summary

Contemporary Geographic Tools Summary

1. Regarding the Industrial Revolution: What? Where? When?

2. Define cottage industry:

3. How did the iron industry benefits from the steam engine?

4. How is the distribution of steel and iron industry influenced by coal?

5. Why was development in transportation necessary?

6. What two forms of transportation grew rapidly?

7. How did the Industrial Revolution change textiles?

8. How did the Industrial Revolution and factory system contribute to the need for food processing?

9. 1. What does the word Industry refer to?10. 2. What two connections are critical in determining the best location for a factory11. 3. How have Transnational corporations influenced the distribution of Industry in recent

generations12. 4. What was the Industrial Revolution and when and where did it begin13. 5. Explain the cottage industry system 14. 6. Explain the contribution of James Watt to the following to the industrial revolution15. 7. How was the textile industry affected by the Industrial Revolution16. 8. What role did the chemical industry play in the textile industry17. 9. How was the food processing industry affected by the Industrial Revolution