Uneven development in a global and regional world

The story so far...
• Structural changes to the economy - Fordism →
Post-fordism → Flexible production

• Keynesianism → Neo-liberalism • Global integration of economic system

Today's objectives
• Marxist perspectives on economic
geography

The persistence of uneven development

• Regulation theory • Spatial division of labor & uneven
development

• Labor geography and mobility

What is Marxism?
• A study of the political
economy of capitalism

• A class-based

understanding of human history moral philosophy

• A political, economic, and

What is capitalism?
• • • •
Dynamic, continuous profit motivation Investors (capitalists) own the means of productions Surplus value is extracted from workers by capitalists A revolutionary process — Creative Destruction

Commodities
• • •
Standardized goods that are sold for a standardized price The value of a commodity is equal to the labor put into it (value-add) Value is only created when commodities are in circulation

Circuits of capital
M' — C = P — C' — M'...

Crisis of overaccumulation
• • •
The need for ever expanding profits means that capitalists must produce as many commodities as possible This leads to over-production and eventual collapse of profitability If wages are cut to maintain profitability, eventually demand will collapse

Money (M) is used to purchase two commodities MP (C) the Means of Production (MP) and Labor Power (LP) to produce a value-added M — C = P — C' — M' — C = P — C' — M'....... commodity (C') through a production process (P) and LP turned into a profit (M') C' is then sold for a profit (M'), which is then invested again in more MP and LP....

W
M — C = P — C' — M'...

Spatial fixes
• • •
New markets and labor must be constantly found to counter crises of over-accumulation (Fix 1) Capital investments like infrastructure are needed to create a new space for accumulation These investments are 'fixed' in space and cannot move along with capital (Fix II)

The creation of new markets
• • •
Colonialism for both raw materials and new markets Neo-colonialism & geo-politics Creation of new domestic markets (e.g expansion of subprime credit)

Core-periphery relationships
• • • •
Peripheral regions have less power in global markets Profits made in the periphery are often invested elsewhere Transfer of wealth from the periphery to the core Operates at a variety of scales (Canada and Bangladesh or Toronto and Fort MacMurray)

Emerging Cores
• • •
Trade amongst 'non-core' countries growing rapidly World cities in the global south are critical nodes in the global economy New core/periphery relationships are something new?

Uneven development and capitalism
• • •
Uneven development is an inherent part of the capitalist system Wealth is extracted from a particular area for the benefit of others There is no 'natural' or 'expected' path of development

A few problems with Marxism
• • •
Overly essentialist Ignores everything that isn't class conflict Capitalism hasn't collapsed yet

The Régulation School
• • • •
A Neo-Marxist explanation of why Capitalism avoids crisis and collapse Not rules, but rather regularization Looks at connections between regimes of accumulation and modes of régulation Focus is on the role of social institutions rather than pure markets

Regimes of accumulation

The regularities that ensure a coherent process of capital accumulation Pre-industrial, Rentier capitalism, Fordism, PostFordism Three main attributes:

• • •

The dominant organization of production Common time horizons for investment Distribution of value in a system

• Historical RoAs:

Modes of régulation
• •
Historically produced set of institutions that reproduce current system of capitalist relations Reproduction of social relations & labor force decentralized decisions made over time

Modes of Development
Regime of Accumulation Extensive Mode of Regulation Competitive Mode of Development Laissez-faire Capitalism Keynesian Welfare State Neo-liberal Capitalism Time Period

1800s-1910s

• A social system created by a series of

Fordism

Keynesianism

1910s-1973

Post-Fordism

Neoliberalism

1973-present

Changes in Modes of Development
• Shift in RoAs and MoRs come from
structural crises

Unevenness and spatial divisions of labor
• Persistent uneven development consequence
of spatial divisions of labor (SDL)

• External crises — new technologies (steam
power, flexible production) that disvalue current capital investments change value of goods and investments

• SDL is more than where workers are located
— what types of social systems develop to reproduce labor systems? constructed

• Internal crises — Financial crises which

• Uneven development and SDLs are

Geological metaphor
• • •
Different rounds of investment and disinvestment are 'layered' on regions The nature of each layer will affect how the newer layers 'settle' or combine with older ones An 'interrelation' of layers

The layers of Waterloo
1990s - Silicon Valley North 1950s - University of Waterloo 1940s - Metal working industry 1830s - German industry 1800s - Mennonite Farmers

Deck of cards metaphor
• • •
Regions' economies are 'hands of cards' created by historical economic development The present economic situation is constructed out of past rounds of investment But 'cards' can be used in unique ways

Problems with metaphors
• • •
How to judge the role of history? Are cards random? Hard to define 'rounds of investment' Need to careful consider how spatial divisions of labor create a place

Labor is a strange commodity Geographies of labor & capital
• • • •
Labor is treated as a commodity, but it isn't like any other commodity Labor needs to be constantly reproduced "Labor-power has to go home every night" Labor is not a fungible commodity

Y = (Lα,K β, ) Pure economic view: Output is a function of labor and capital

Labor is inherently local
• • • •
Workers need to be able to commute to work Importance of locallybased knowledge to find job Local Labor Control Regimes

Capital's control of labor
Capital(ists) try to create a system of social institutions and regulations that create their desired workforce Workers are disciplined within the workplace and beyond in order to maintain that workforce Firms (especially TNC) are able to influence local laws to suit their purposes Power comes from their control over space & mobility

• • •

Example: Industrial estates
• • •
Company not only owns factory (means of production) but also living facilities for workers Establish control over individual space Both workspace and living space are sites of labor control

Restructuring labor markets
• • • •
Labor markets are restructured to reduce costs and make relationships with labor more 'flexible' Often associated with roll-out neoliberalism Can be happen through in-situ processes or locational shifts Goal is to change nature of local labor relations

Role of state in creating labour market

Gov't regulations on education and training crucial for developing new generations of workers Laws on unionization & labour rights State (national/regional/ local) plays important role in what kinds of workers exist

• • • •

Factors limiting firm mobility
Aversion to lost sunk costs & past investments High costs of relocation, establishing new supply chains & training new work force A need for particular labor force found in the region Emotional/symbolic connection with area

• •

Labor's control of capital
• •
Lean production systems and the spatial expansion of production systems makes are vulnerable to work actions Strikes and takeovers aim to control the physical space of production or disrupt networks of production

Labor mobility
Labor migration in China, 2000-2005

• • •

Workers can migrate to find higher paying jobs or better working & living conditions Financial, social, and political barriers to movement (e.g Hukou system 戶籍謄本) Loss of critical social & support networks

Regional labour forces
• • •
Spatial divisions of labour, Gov't regulation & industrial production create distinct labor forces Variation within and between regions Composition of labour force has huge implications for future development

Summary
• Uneven economic development is inevitable
part of capitalism

• Regional economies & labor markets are
created through historical processes

• Processes of (dis)investment &

restructuring help create, perpetuate and sometimes solve unevenness

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