INDUSTRIALIZATION APHUG REVIEW

History of Industrialization Existed in some areas pre-18th c (silk factories/China, metal workshops/India) Work done by hand; powered by water or wind James Watt’s steam engine more efficiently pumped water to power factories New methods of smelting iron

Industrial Revolution=England Textile industry: w/ steam engine weaving thread and cloth was quicker=more need for raw materials (wool, linen, cotton) England had gov support, money from colonies, and COAL; IR spread to other industries in England like transportation and communication Used steam power for RR and ships Factories located near resources and population grew around these factories

Diffusion of Industrialization started in coal fields of England Spread to coal fields of Europe: France, southern Belgium, Netherlands, Germany, Poland ( 19th c) Used access to skilled labor and transportation routes already established through colonialization Spread to Spain, Scandinavia, Ukraine (early 20th c) Diffused to North America (natural resources and land) Samuel Slater- first textile factory in Rhode Island-1791 Protected by U.S. gov through embargos and high tariffs Northeastern U.S. Processing food, lumber, eventually iron and steel (late 19th c)

IR after WWI Europe and USA had huge economic advantage Shift to oil and natural gas as major resource; less reliant on coal Turned to foreign countries to supply: Canada, Saudi Arabia, Kuwait, Iran, Russia, China, Mexico, Venezuela, Nigeria; many multi-national corporations moved to these places to be near supply; most wealth returned to USA causing tensions (and war) between these countries

LOCATION THEORY Explains the pattern of location of economic activities by identifying factors of influence Primary industry-near natural resources (Western and Central Europe, Eastern North America, Russia and Ukraine, Eastern Asia) Secondary industry- not as dependent on location of resources which can be transported to factory Location of secondary industries depend on: Variable costs of energy, labor, transportation Friction of distance=the farther away, the more expensive to transport. Distance decay-related to friction of distance in regard to distribution; the market is usually located near factory

Weber’s Model-Least Cost Theory, explains the location of SECONDARY industries German economic geographer Alfred Weber Transportation-raw materials to and finished products away from factory (trucks for short distance, RR for medium, ships for long) Labor-cheap labor often makes up for more expensive transportation costs (USA to Mexico or Indonesia) Agglomeration-cluster of similar business-provide support for business in equipment, clothing, customers

Situation Factors Optimal location is near customers BULK-GAINING INDUSTRIES-gains volume or weight during production; needs to be located near where product is sold; examples: canned food, bottled soda, cars SINGLE-MARKET INDUSTRIES-specialized manufacturing with only one or two customers; example: YKK zipper company in 68 countries near clothing manufacturers; parts suppliers for auto industry BULK-REDUCING INDUSTRIES- located near raw materials because raw materials are heavier than finished products; example: steel industry in Birmingham, AL near coal and iron PERISHABLE-PRODUCT COMPANIES-located near customers for rapid delivery before a product spoils; example: bread bakeries and milk bottlers

Site Factors-factors related to the cost of production inside the plant Often MORE important than situation factors! Labor-most impt site factor on global scale; China ¼ of world’s industrial workers, India 1/5, ALL DEVELOPED countries combined about 1/5 Land-factories originally located in cities near labor source in mult- storied building to save on land costs; today factories are most efficient in one-story buildings where assembly follows a logical order (raw materials delivered at one end and finished product shipped from other); cheaper in suburban areas Capital-manufacturers typically borrow money to start or expand industry; example: auto industry in Michigan, high tech industry in Silicon Valley (1/4th of all new capital in USA is spent in Silicon Valley!)

NAFTA: North American Free Trade Agreement Mexico, USA, Canada 1994; eliminated most barriers to moving goods Said to rival European Union in wealthiest and most populous market PROBLEMS: Cheaper labor in Mexico Lower standard of living in Mexico Labor unions concerned with relocation of American and Canadian industries to Mexico Lower environmental standards in Mexico MAQUILADORAS: (a factory in Mexico run by a foreign company and exporting its products to the country of that company) automobile plants in Mexico near the USA border; nearly all new growth is here, not in USA or Canada; these jobs are now being lost to China because maquiladora jobs ($2/hour) are going to China($1/hour)

Maquiladoras Export processing zone (EPZ) or Free Trade Zone (FTZ) Companies often criticized for violating human rights and damaging environment due to the lack of customs authorities and lax environmental laws; example-NIKE Example- General Motors Cities along border: Ciudad Juarez in Chihuahua partnered with El Paso, Texas= 2nd largest bi-national metropolitan area along border Ciudad Juarez- population 1.3 million “most violent city” outside an actual war zone, 4 international bridges, 300 maquiladoras Tijuana-San Diego, CA largest bi-national metro border Large, skilled workforce 550 maquiladoras, which usually pay more than average wage Tijuana-violent and connected to drug wars

China, Special Economic Zones (SEZ) Same as EPZ’s Most notable in China is Shenzhen, north of Beijing in Guandong Province Originally small, rural, coastal town with little technology and resources 1980 China declared SEZ Pop now 1.9 million and growing; handles 210 million tons of cargo per year Good communication with Beijing, ocean ports, RR system, international airport *The entire province of Hainan has been designated SEZ

Shenzhen: before and after

4 Asian Tigers Hong Kong, Singapore, South Korea, and Taiwan Rapid industrial growth in fewer than 30 years Skipped through steps in Rostow’s stages of growth model Common characteristics: Seaports, rapidly growing populations, industrialized cities, educated/skilled workforce Investments from foreign companies-trade with USA and Europe Manufacture/trade EVERYTHING! Low-quality textiles, toys electronics to high demand products Hong Kong and Singapore=now financial and information centers

4 Little (Baby) Tigers Malaysia, Vietnam, the Philippines, Indonesia Striving to be like a big tiger, but haven’t reached that status YET

Deindustrialization in USA-when manufacturing plants leave an area on a large scale Happened over last several decade Outsourcing of industrial jobs Relocate factories from American manufacturing regions to manufacturing belts in other countries (SEZ, EPZ, FTZ) Cheaper labor in other countries Lenient environmental laws allow for cheaper production Example: The Rust Belt, includes area around Great Lakes with auto manufacturing plants; after outsourcing plants sit vacant