1. Industry Review

2. Types of Economic Activities
Primary Sector Activities
Secondary Sector Activities
Tertiary Sector Activities
Agriculture
Raising animals
Fishing
Forestry
Mining
Refining petroleum
Turning metal into tools and automobiles
Manufacturing
Trade
Finance
Real Estate
Private services
Government
Transportation

3. “Industrialization and Economic Development”
Ch. 11 Industry + Ch. 9 Development

4. Key Issue 1: Why does development vary among countries?
HDI – Human Development Index
Economic - GDP Per capita
Social – literacy rate and amount of education
Demographic – life expectancy

5. Human Development Index

6. Where did industry originate?

7. What did Europe look like prior to the Industrial Revolution?
Home based manufacturing (known as cottage industry)
On a small scale
Dress found at

8. The Industrial Revolution
Why did it begin in Great Britain?
capitalist system
guilds had created a middle class of workmen
people free to form businesses
education
patent system encouraged development
labor:
Jethro Tull’s seed drill (1701) and other developments > improved productivity in farming > people can leave farms and work elsewhere

9. Why did it begin in Great Britain? (CONT)
raw materials (iron ore, coal)
rivers, canals, harbors (ease in trade)
small, compact size (iron and coal near rivers and harbors)
existing banking system (borrow $ to buy machinery)
stable political system
colonies (guaranteed markets, additional raw materials)

10. Flow of Capital into Europe, 1775
Needed flow of capital in order to fuel the industrial revolution.
United Provinces = The Dutch

11. Important Innovation 1 The Steam Engine Patented by James Watt in 1769
Was the first (there had been steam engines in ancient times) to be able to make one efficient enough to power other things than itself

12. Important Innovation 2 Puddling and rolling of iron
By Henry Cort in 1783
Iron purification process that increased the manufacture of iron
Puddling furnace
homepage.ntlworld.com/m.low1/PDF/iron_mill.pdf

13. Important Innovation 3 Railways or “iron horse” Two key inventions:
A locomotive using Watt’s steam engine
Iron track
The Rocket

14. Important Innovation 4 Chemicals
Sulfuric acid, chlorine gas and lime, vitriol
Today, the largest textile factories are owned by chemical companies

15. Important Innovation 5 Food preservation techniques
Canning by Nicholas Appert (done in glass jars)
Peter Durand’s tin can

16. economic: more goods at lower prices
Effects
economic: more goods at lower prices
social: available labor leaves farms and clusters in cities
urban blight, pollution
canned food (encourages new industry)
political: surplus labor > mistreated workers > liberalism and communism

17. technological: > railroad, steamship
Effects
technological: > railroad, steamship
agricultural: > 2nd Agricultural Revolution
increased productivity
use of machinery > larger farms > enclosures
demographic: caused move from Stage 1 to Stage 2 of DTM

18. Where is industry distributed? Key Issue #2

19. Diffusion of Industrial Revolution

20. Early diffusion
eastward to Belgium, France, and Germany (early 1800s; delay due to Napoleonic Wars)
further diffusion to Italy, Netherlands, Russia and Sweden by late 1800s
U.S. not affected by political instability in Europe: diffusion by early 1800s
8,000 spindles of textiles in 1808 > 80,000 spindles by 1811
by Civil War, U.S. was world’s 2nd largest industrial power

21. Why do industries have different distributions?

22. Weber’s Model for the Location of Industry
Transportation
Labor
Agglomeration
It is more expensive to move raw materials than it is to move final products.
Short distances = use a truck
Medium distances = use a train
Long distances = use a ship
You can locate your business further from market if the labor costs make up for the cost of the added distance
If several industries cluster in one city, they can share talent, services and facilities.

23. Single-market manufacturers Costs of land, labor and capital
Situation Factors
Site Factors
Bulk gaining
Bulk reducing
Single-market manufacturers
Costs of land, labor and capital
Labor intensive industries look for cheap labor
Footloose industries are so expensive to produce on their own that transportation to and from markets or factories is negligible

24. Situation factors Inputs Factory Consumers
Each industry has to consider what costs more: to transport inputs or to transport the final product to consumers?
Factories are located to REDUCE cost

25. Other types of plants Perishable Products Single-market manufacturers
Located near the consumer
Exs mostly include fresh foods
Newspapers (kinda)
Single-market manufacturers
Make specialized parts to go into larger products
Located near the consumer

26. How do inputs and products get from place to place?
Short answer:
Trucks
Trains
Ships
Air
Important points
Often times modes get mixed (might use planes and trucks etc.)
Costs rise every time you switch from one mode to the next
Break of bulk point- places like seaports and airports where you can transfer from one mode to the next easily

27. Land factors Factories likely to be located in suburbs and rural areas
Energy sources play a key role (are you next to hydroelectric power? Are you near coal fields?)

28. Labor factors
Is your industry labor intensive? Do you pay a high percentage in wage? (note percentage does not equal high wages)

29. Capital
Industry will locate where it is able to get capital from banks

30. Industrial Regions of the World
Primary Industrial Regions
Secondary Industrial Regions
Western and Central Europe
Eastern North America
Russia and the Ukraine
Eastern Asia
Venezuela, Argentina, Brazil in South America
South Africa and Nigeria in Africa
Coastal areas and the Ganges River are of India, Malaysia, and southern Australia

34. Economic Organizations
NAFTA- North American Free Trade Agreement- Mexico, US and Canada (helps explain the new international division of labor where some components of products are made in one country and others in another)
The European Union- Most barriers to trade have been eliminated among them members of the EU. Countries that are not a part of the EU (Switzerland and Sweden) rely heavily on trade with the EU countries.
East Asia does not have its own formal organization but it is an important trading bloc.
ASEAN – Southeast Asian version of NAFTA.

35. What is deindustrialization and who is going through it?
More developed countries are decreasing the total number of manufacturing jobs in favor of service industry jobs
The United States and Europe are experiencing this
Japan is joining in this along with the Four Tiger economies (Hong Kong, South Korea, Singapore and Taiwan)

36. Why are there disparities between countries
Why are there disparities between countries? What challenges exist for LDCs?
Distance from markets
Inadequate infrastructure
Competition with existing manufacturers in other countries

37. Demographic Transition Model

38. Theories of Economic Development- Rostow’s Modernization Theory

39. Theories of Economic Development- Wallerstein’s Dependency Theory
Core countries
Rich nations fuel the world’s economy and take raw materials from the rest of the world
Periphery countries
Colonialism drew in low income countries that support the rich via cheap labor and a large market for industrial products
Countries of Semiperiphery
These countries are somewhere in between. They are still dominated by the core.