Unit 6: Industrialization and Development Part 3-4

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1 Unit 6: Industrialization and Development Part 3-4 ORIGINAL AUTHOR UNKNOWN, but appreciated greatly! Additional information added by A. Parkhurst, M.Ed

2 Part Three: The Evolution of Economic Cores and Peripheries 2

3 A) Introduction 3

4 Why do you think that some places were affected by industrialization while others were not? 4

5 Location Theory Locational Independence Theory 5

6 A) Location Theory 6

7 What is Location Theory? 7

8 Location Theory explains the locational pattern of economic activities by identifying factors that influence this pattern. 8

9 Primary Industry Develops around natural resources. Secondary Industry Develops as transportation improves. Less dependent on location 9

10 Variable Costs Secondary Industry Locations Distance Decay Friction of Distance 10

11 Core Primary and Secondary Industries Semi-Periphery Secondary Industries Periphery Neither 11

12 What is the Least Cost Theory? 12

13 Alfred Weber s Least Cost Theory is a theory that explains the location of industries based on transportation, labor, and agglomeration. 13

14 The point for locating an industry that minimizes costs of transportation and labor requires analysis of three factors: 1. Material index 2. Labor a. Unskilled b. Skilled 3. Agglomeration and Deglomeration 14

15 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. 15

16 Weight (Bulk) Gaining Soft Drink Manufacturing Weight (Bulk) Losing Copper Timber Most Agriculture 16

17 17

18 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 18

19 Weber uses the location triangle to define an optimal location. w(m) tons to be sold at market M optimal factory location P located at the respective distances of d(m), d(s1) and d(s2) w(s1) and w(s2) tons of materials coming respectively from S1 and S2 are necessary 19

20 A) Least Cost Theory Continued 20

21 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 21

22 What is the Break of Bulk Point? 22

23 The Break of Bulk Point is where the transfer of goods among transportation modes is possible. 23

24 24

25 Product per Case Cost/Rail Cost/Road Fuzzy Mice Concrete Oil Town 10M 5M 11M 6M 3M Resource 1 Resource 2 25

26 What is the Location Interdependence Theory? 26

27 Location Interdependence Theory is a theory that explains the location of industries based on the location of their competition. 27

28 Variable Revenue Analysis The ability of a firm to capture a market that will earn it more money and customers than the competition. 28

29 The Beach How would Locational Interdependence Theory play a part in where A and C would choose to locate? 29

30 Losch s Model 30

31 Situation Factors Transportation Issues Bulk-Gaining, Bulk Losing Site Factors The cost of Land, Labor, and Capital Climate Access to Amenities 31

32 Part Four: Contemporary Patterns in Industrialization 32

33 A) Globalization and Infrastructure 33

With the increase of Space-Time Compression, it is possible to locate businesses in places not

34 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. 34

35 What is infrastructure? 35

36 Infrastructure includes services that support economic activities. It provides for transportation, communication, education, and other external needs of a company. 36

37 B) Primary Industrial Regions 37

38 Western and Central Europe Eastern Asia Primary Regions Eastern North America Russia and the Ukraine 38

39 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. 39

40 40

41 Russia and the Other Soviet Republics Much manufacturing up through the 1930s followed the Volga River. Other regions followed the Trans-Siberian Railroad. 41

42 42

43 Asia Japan The Kanto Plain Tokyo The Four Tigers (Export Oriented Industrialization) South Korea Taiwan Hong Kong Singapore China Northeast District in Manchuria Beijing, Shanghai, Hong Kong The Pacific Rim 43

44 C) Secondary Industrial Regions 44

45 Southeast Asia Secondary Industrial Regions Northern Africa Mexico Brazil 45

46 What is the maquiladora? 46

47 The Maquiladora is a manufacturing zone created in the 1960s in Mexico that mostly produces American products. 47

48 What is the NAFTA? 48

49 NAFTA is the North American Free Trade Agreement which eliminated barriers to free trade in North America. 49

Industrialization. Why Do Industries Have Different Distributions?

Industrialization. Why Do Industries Have Different Distributions? Industrialization Why Do Industries Have Different Distributions? Industrial Revolution industry refers to the manufacturing of products Began in England in the late 1700s Diffused rest of Europe and North