1. Agriculture & Rural Land Use – Key Topics Commercial Agriculture
Subsistence
Agriculture
Primarily for purpose of selling products for money, often monocultures for economies of scale
Primarily for direct consumption by a local population, usually small scale and low tech
DISCUSSION:
* How does commercial agriculture differ from subsistence production?
* Is commercial agriculture equivalent to agribusiness?

2. Intensive Land Use Extensive Land Use
Small-area farms or ranches
High inputs of labor & high output per acre
Rice paddies, southeast China
Cattle ranch, northeast Colorado
Extensive Land Use
DISCUSSION:
* How does "intensive" agriculture differ from "labor-intensive" and "capital-intensive" agriculture?
Large-area farms or ranches
Low inputs of labor & low output per acre

3. Large amount of human work is applied per unit of output
Labor-Intensive
Agriculture
Large amount of human work is applied per unit of output
Top picture – Labor-intensive corn raising in central Mexico.
Bottom picture – Corn exported from capital-intensive U.S. farms to the Mexican market
Capital-Intensive
Agriculture
DISCUSSION:
* In what other areas of the developed world is productivity increased by utilizing capital vs. labor intensive practices?
Large amount of capital (equipment and buildings used to produce other goods) is applied per unit of output

4. Subsistence – predominantly low-income regions
Intensive subsistence – subtropical monsoon areas
Shifting cultivation – tropical forests & savannas
Nomadic herding – semiarid and arid lands
Commercial – predominantly high-income regions
Crop farming – more humid climates
Livestock ranching - drylands

5. Probable culture-hearths of agriculture
First Agricultural Revolution
Invention of farming & domestication of livestock (8,000–14,000 years ago) + diffusion from several source regions = shift from hunter-gatherer to agricultural societies
DISCUSSION:
* What types of technical innovations made the First Agricultural Revolution possible?
Probable culture-hearths of agriculture

6. Second Agricultural Revolution
Technological changes (starting 1600s in Western Europe; spread by 1800s to North America)
Began with new methods: crop rotation, better horse collars
Later innovations: replace human labor with machines, supplement natural fertilizers & pesticides with chemical
Beginnings of commercialization of agriculture (production of surplus for trade); enabled widespread urbanization
DISCUSSION:
* How do machines like the one featured here boost agricultural production?
* How does rotating crops assist in boosting agricultural production?

7. Factors influencing location of agriculture
• Climate and natural environment
• Culture
• Economic factors
Urban market
High transportation cost items
(vegetables, eggs, dairy, flowers)
Intensive land use – high land rent
Medium transportation cost items
(corn, soybeans, mixed farming)
More extensive land use – medium rent
DISCUSSION:
* Von Thünen developed his model in Is it still relevant today?
* Are transportation costs still an important factor in where certain products are raised today?
Lowest transportation cost items
(forestry, wheat, livestock ranching)
Most extensive land use – lowest land rent
Simplified von Thünen model of agricultural land use (1826)

8. Chile’s agricultural exports
Vegetables and orchards near Santiago
Regional produce warehouse in Chile
Market in Slovakia

9. Third Agricultural Revolution
Since 1960s
- hybridized grains for better yields (“Green Revolution”)
- greater reliance on synthetic fertilizers
- genetically engineered crops
- vertical integration of ownership (e.g., Cargill, ConAgra, ADM)
- globalization of production
A partial list of ConAgra’s brands
Swiss Miss Hunt’s
Van Camp’s Marie Callender’s
Wesson Hebrew National
Slim Jim Egg Beaters
Rosarita Chef Boyardee
ReddiWip Pam
Peter Pan Orville Redenbacher’s
Healthy Choice Banquet
DISCUSSION:
* How does this billboard reflect the Third Agricultural Revolution?
* What is the difference between hybrid and genetically engineered plants?

10. “Green Revolution” – 1960s -1980s
Rice - staple food for 2.5 billion Asians - provides 2/3 of calories for Asians with rice-based diets
Green Rev – Raised yields
* Improved rice strains
* Greater use of fertilizer
* Increase use of irrigation
Asia’s rice production grew at annual rates of 3.0% until 1980s
Yield growth rate exceeded high pop. growth rates of the time
Rice plant
Sources: FAO, IRRI (research organization devoted to rice) – part of global CGIAR effort at improving yields of staple crops worldwide

11. “Post-Green Revolution” (since 1980s)
Green Revolution Plusses:
Countries self-sufficient in rice or even exporters (Thai, Viet).
Poor people benefited as yield increases caused real price of rice to drop.
Problems
Successes led to less concern about food security, and less
investment in irrigation, agric research, and rural infrastructure.
Growth rate in rice production declined during due to drop in growth rate of rice yields.
In most places, despite increasing use of fertilizers, further increases in yields became harder to achieve and more costly.
Mobilising science for global food security

12. Globalization of the Cut-Flower Industry
Kenya has become the European Union's biggest source of flower imports and overtaken Israel as market leader. It has a 25% market share, beating Colombia and Israel, which each have about 16%.
Two thirds of these blooms go to the Netherlands, which dominates the trade in cut flowers worldwide through its auction halls where Dutch wholesalers buy flowers for re-export to markets as far away as the United States and Japan.
Valentine's Day is a big date for Kenyan growers, thanks to the country's perfect match of high altitudes and equatorial sunshine. Roses make up 74% of Kenya's flower exports, followed by carnations which are the most popular flower in Britain at less romantic times because they last longest. Source –                   
Flower industry workers in Kenya (left) and Colombia (right)

13. Third Agricultural Revolution
Benefits
Reduced uncertainties in agriculture
Greater global exchange of ag products
Increased yields
Costs
Increased dependence on fossil fuels
Reliance on chemical inputs
Less global diversity of food products
Concentration of pollutants
DISCUSSION:
* How does this billboard reflect the Third Agricultural Revolution?
* What is the difference between hybrid and genetically engineered plants?

14. Sectors of the Economy Secondary Primary Tertiary Quaternary
Figure 6.11 (p. 150)
Figure 6.1 (p. 138)
Secondary
Primary
DISCUSSION:
* How do the photos in this slide represent the four sectors of the economy?
* What are some other examples of these four economic sectors?
Tertiary
Quaternary

15. Background on Economic Restructuring
of the U.S. and Canadian Economies
Job Competition
Figure 6.8 (p. 147)

16. Structural change of the economy
Figure 6.10 (p. 149)

17. Least-Cost Location Theory
Cost minimization is half of profit maximization equation (along with maximizing revenues)
Cost minimization theory:
- labor-cost minimization
- transportation cost minimization
Cost minimization - an industrial location strategy that seeks to minimize what the firm pays to produce and distribute its products or services
DISCUSSION:
Why is cost minimization so important to a business?
π=TR-TC

18. Sources: PBS & Ingolf Vogeler
Minimizing Labor Cost
Maquiladoras – foreign-owned assembly plants in Mexico (mostly textiles and consumer electronics)
Over 11,500 maquiladoras along border with U.S.; employ 2 million+ Mexicans
Revenues from maquiladoras, exceed make up 85% of trade between Mexico and U.S.
Sources: PBS & Ingolf Vogeler
Average work week is hours; wages about $5.75 per day. Women are 70% of maquiladora workforce.
Since 2000, some maquiladoras have closed as corporations move assembly-line jobs to even lower-wage countries, mainly China.

19. Fixed and Variable Costs Influence the Optimum Location for Economic Activity
Classical economic geography models focus mainly on the variable cost of transportation

20. (but with differing amounts of raw mat’s needed)
Determining the best location for a mfg. plant with raw materials in Minnesota, Florida, and Texas & the market in New York
(but with differing amounts of raw mat’s needed)
Adopted from Weber model (See Fellman textbook for model name.)

21. Weber Triangle Three factors: Transport costs: Transport costs
Labor costs
Agglomeration
Transport costs:
One market and two sources:
Equal distance and shipping costs dictates a market location
Two weight-losing materials results in an intermediate location
Wood or glue: which has a higher transportation cost?
What about chairs or slabs of wood? Slabs of wood.
Manufacturing – where is it located? In the city? Transportation important aspect of manufacturing.
Silicon Valley – agglomeration of industry in one area. (See slide 25)

22. Weber’s Theory of Location
Weber’s theory results in 3 generalizations:
Using pure materials in the production process will always dictate a market location
Weight-loss materials usage will pull the plant closer to the sources
Intermediate location chosen most often
No handling costs at terminal

23. Weber’s Theory of Location
Labor Costs:
Location chosen always has least combined costs
A location my have higher transport costs, but more inexpensive labor
Isocheims: lines of equal transport cost
Isodapane: line of total transport costs (sum of isotims)

25. Weber’s Theory of Location
Agglomeration:
Weber recognized that clustering will result in a per unit savings
Example:

26. Transportation Cost Minimization
Raw Material Oriented
Tendency for industry to locate near its source of raw materials in order to save on transport costs
Usually occurs when raw materials lose weight in the production process (e.g., paper, steel)
DISCUSSION:
* What raw materials need to be processed close to where they are extracted due to high transportation costs?

27. Transportation Cost Minimization
Market Oriented
Tendency for industry to locate near population centers in order to save on transport costs
Occurs when product is more costly to transport than raw materials (e.g., beverages, glass)
DISCUSSION:
What raw materials need to be processed close to markets due to high transportation costs?
Weight gained industries: beer, soda…bottling is done in market area not at the factory level because the weight factor of the product is costly when transported from the original manufacturing source.

28. Break-of-Bulk Oriented
Transportation Cost Minimization
Break-of-Bulk Oriented
Location between sources of raw materials and markets – for products that must be divided and shipped from a central point of entry
Intermodal transportation – e.g., moving from rails to trucks or ships to trucks, or ports to pipelines
DISCUSSION:
* What raw materials would be processed at a break-of-bulk point?

29. Where is the best location for a steel manufacturing plant?
Recipe for steel (traditional)
Coal = 2 to 3 tons (+ energy*)
Iron ore = 1½ to 2 tons
Limestone = ¼ to ½ ton
Mix all solid ingredients. Heat at about 600º F until thoroughly melted.*
Pour molten blend into molds. Cool and serve. Makes one ton of finished steel.

30. The recipe for making steel has changed (new technology) How has this affected the location of modern steel-producing areas?
Where is scrap iron from?
Taconite is still found in the Great Lakes region
Steel production moving to the coastal areas - transportation

31. Shipbreaking industry, Bangladesh
Shipbreaking yards in Bangladesh alone dismantle about 90 giant ships a year, mostly oil tankers, generating millions in revenue, employing tens of thousands, and providing a significant proportion of the iron and steel used by local industry. However, there is a dark side to the industry in which the workers must toil in extremely hazardous conditions that frequently lead to death or serious injury and which is tremendously harmful to the environment. ... A majority of ships are built in South Korea and China, filling orders placed by Japan, the UK, the US, Norway, Singapore and Denmark. Until the 1970s, shipbreaking was done in the countries of origin, using heavy machinery on salvage decks. But increasing environmental regulations and labour costs resulted in the transfer of this work -- first to Korea and Taiwan, and then to South Asia after the Asian Tigers upgraded away from this work.
Source:
Where are we going to find cheap labour to break down tankers formerly used by oil companies- see 60 Minutes segment on this industry (download available)
Also look at the dismantle issue surrounding computers and cell phones on 60 Minutes.

32. Consider transport costs of a car’s components
Consider transport costs of a car’s components. Where’s a good place to locate your assembly plant?

33. Over 50,000 U.S. auto-making jobs in these foreign-owned plants (New York Times data and map, 2005)
Explain why car manufacturing is not in Seattle or in the Colorado.

34. The cost of transporting data has declined to near zero
Low transmission costs, plus ability to digitize data, revolutionized the location choices for high-tech industry
The cost is going down
Source: Probe Research, Inc., Telcordia (Bellcore); Progressive Policy Institute.

35. “Post-Fordist” Production – High Tech Industry
Adapting the traditional models of economic geography
Greater flexibility of production
Less reliance on storage of inventory – seek prompt delivery of goods needed for production (“just-in-time”)
Suppliers’ location
Need to have access to fast delivery systems (= airports)
Agglomeration of management
Still occurs! High-tech innovators locate closer to airports; universities; amenities; venture capital (tends to be a “footloose” industry)
Internationalized spatial division of labor
Lower labor costs needed for production – industry locates manufacturing in lower wage areas (secondary) but tech and management stays in core area (quaternary)
This is the period we are in now is our industrial history. Source: Rubenstein. Good video about this concept in Power of Places series.
Footloose industry = Google (easy to find a new location, easy to move)
International spatial division of labour covered by de Blij and Rubenstein….also Power of Places has a good segment on this concept.
Nike shoes: figure out where all the pieces and parts of the shoe are from in the world – a sense of globalization. Where is the shoe manufactured? Where is the Nike’s HQ located?

36. Economic Base Model Figure 6.7 (p. 146) DISCUSSION:
Where does the "regional multiplier" effect manifest itself in this model?
Military bases could be considered “economic base model” – German government is worried about the US moving/decline in military in Europe – impacts German economy.
Figure 6.7 (p. 146)

37. Multiplier Effect
This is covered in more detailed in Kuby – use Kuby for application and illustrations.