Professional Documents
Culture Documents
Chapter 12 For CD
Chapter 12 For CD
• Peripheral or
central location?
• Accessibility?
Major world trade lanes
• Many factors
influence
locational
decisions of
firms,
individuals,
governments,
etc.
6
Technology & the Economy
8
Early Cradles of Civilization:
Economic Factors
11
Classification
16
Russian disinfection center
• Source of political
instability – this
condition didn’t exist
under communism.
19
Traditional Economy
• Non-industrial
• Basic economic questions answered by doing what
is “customary”
• Generally opposed to risk-taking behaviors
• Private ownership of capital
• Land may be privately owned, but often is
considered the property of the group – the tribe.
• No country today has this economy, but there
may be areas within developing countries where
this is the type of economic system
20
Mixed economy – what all countries
really have.
• Mostly combination of market & command
economies
• U.S. – Mixed Market Economy – leans toward the
market system, but there is government involvement
in the economy
• China – Mixed [socialist economy] – overall planning
by the government, but some “privatization” has
been allowed – joint ventures with capitalist firms
from outside China – SEZ’s & unique status of Hong
Kong
• Brazil – Mixed Market Economy with pockets of 21
traditional economy in the interior
Sizes of Economies
22
23
Primary Economic Activities
• The simplest, closest to nature, use of earth
products
– Hunting & gathering
– Agriculture and animal husbandry – growing plants and
harvesting the fruit and raising animals for sale
– Extracting minerals from the earth – various ores, crude
oil, natural gas, etc.
– Fishing
– Lumbering
24
Primary: Subsistence Agriculture
25
extensive
subsistence
agriculture
• Slash-and-burn
agriculture – a form of
crop rotation. Probably
the most efficient use of
the tropical lands in the
long-term. Does not
support a large
population
26
Intensive subsistence agriculture
• Labor Intensive
27
Green Revolution
28
Green Revolution
• Emphasis on crops not generally grown in Africa
south of the Sahara
33
Commercial Agriculture
• Intensive Commercial Agriculture
– Higher value land & closer to markets
– Use of much machinery, fertilizers, labor, etc.
– Dairy farms, truck farms – perishables (refrigerated trucks
& railroad cars extended the economic distance from
markets)
– Livestock-grain farming – farther from markets in U.S.
• Extensive Commercial Agriculture
– Less expensive land & farther from markets
– Wheat farms use expensive capital – combines are
expensive so cooperatives may purchase some
– Large land areas (low capital output per unit area) 34
– Typified by large wheat farms and livestock ranching
Agriculture: Special Crops
39
Lumbering – primary activity
40
Mining, etc.
• Affected by balance of
three factors: quantity
available, richness of
ore, and distance to
markets
• Land acquisition and
royalty costs may equal
the other three
• Competition may also
be a deciding factor
41
Trade in Primary Products
42
Secondary Activities: Manufacturing
43
Weber’s model visualized
• Rather rigid
formula that may
not give sufficient
weight to factors
other than
location.
44
Other Locational Considerations
46
Location: Comparative Advantage
55
Developing Countries
56
57
Industrial Revolution: Why England?
• Resources: had limestone, coal, and iron ore
• Government that encouraged business
• Large available workforce (Enclosure Acts)
• Sufficient number of capitalists – risk-takers
• Large market – domestic & colonial
• Good relative location – center of land hemisphere
• Large commercial fleet of ships
• Good water supply (water power & for steam)
• Good number of inventors (favorable environment)
• Available raw materials: wool – domestically & cotton from
colonies – Egypt, India, America
58
Post-Industrial Transition
59
Tertiary and Beyond
• Tertiary Services – service sector
– Growing sector in older, industrialized economies
– Has replaced secondary activities as the largest sector in
the U.S. economy
• Beyond Tertiary –
– Quarternary – Advanced services
• Information handling, management, & research – particularly in
the computer areas
• Specialized knowledge, high-tech skills, i.e. national
accounting firms (serving a nation-wide market)
– Quinary – Executive decision-making
• Special, highly-paid skills, top executives, etc.
• Locate in places with the finest amenities
60
Internet Access by Country
61
Services in World Trade
• Increasing Tradability of Services
– Total of world trade in services
• 1980 – 15%
• 2000 – 25%
• Increased Access to Efficient, State-of-the-Art
Equipment and Techniques
– Facilitates the post-industrial shift
– Adds credence to the old saying, “Knowledge is
power.” Substitute for “knowledge” the ability to
manipulate, regulate, even control information
62
63
64
Hierarchy of
international
financial centers
FINANCIAL SERVICES
Off-shore locations
and “furtive money”.
65
Process of Developing is Difficult
66
Infrastructure
67
Infrastructure
68
Infrastructure
& accessibility
• Colonial
railroads – “tap
root”
• Poor rivers for
transportation
• Poor relative
location
69
Development
• Change in
economic
ideology –
favorable
government
policies.
• On the Pacific
Rim
China • Near Japan
• Huge domestic
70
market
China: Strange Economic Mix
Illegal trade
in body parts
Click on the picture
to see the video
Questionable
practices by Chinese
police and military
6. Political decisions
– British taxing policies encouraged growth of business that
led to Industrial Revolution
– Spanish taxing policies did not encourage business
growth and development
74
Some Key Points:
75
Outdated Classification
76
First: Non-Communist, Developed
• Industrialized, advanced countries – developed
• Mixed-market economy
• Well-developed infrastructure
– Transportation
– Communication
– Education
• Relatively low population growth rate
• The average diet is more than sufficient
• Good health care is available
• Democratic government (usually)
• Examples: USA, Britain, France, Canada, Japan
77
Second: Communist Countries
• Countries that call themselves COMMUNIST
• Some are somewhat industrialized
• Socialist economies (mixed, but heavy on the command
economy elements)
• Infrastructure development varies
• Population growth rate may vary greatly
• Average diet usually nearly adequate to adequate
• Health care available to all but quality may vary
• Totalitarian government
• Examples (few): China, Vietnam, N. Korea, Cuba
78
Third: Non-communist, developing
• Limited secondary activity – mostly primary
• Mixed market economy (often highly socialized)
• Poorly developed infrastructure – not uniformly
developed
• High population growth rate in most countries
• Average diet probably insufficient
• Poor health care, particularly outside the cities
• Government sometimes democratic, but often civilian or
military dictatorships – trend toward democracy has
been growing
• Levels of development varies among and within states
79
Environmental quality