1. Industry
Chapter 11

2. Where did industry originate?

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

4. The Industrial Revolution (Cont)
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

5. The Industrial Revolution (cont)
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)

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

7. How did the industrial revolution diffuse?
Where did industry originate? Key Issue #1
How did the industrial revolution diffuse?

8. 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

9. 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

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

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

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

13. The Industrial Revolution (cont)
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

14. The Industrial Revolution (cont)
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

15. Where is industry distributed? Key Issue #2

16. Diffusion of Industrial Revolution

17. 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

18. Why do industries have different distributions?
Key Issue 3

19. It’s all about 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

20. Bulk-Reducing Industry
If the cost of transporting inputs is greater than the cost of transporting the final product to the consumer… you place the factory closest to the inputs.
Ex. Bulk Reducing Industries because the process of production REDUCES the weight of inputs
COPPER

21. Bulk-Gaining Industry
Industries that gain volume or weight during production
1. Fabricated goods and metals (like TVs, motor vehicles, air conditioners, refrigerators, etc.)
(if we have time)
2. Beverage Production
Water is expensive to ship but can be found in a lot of places so there are beverage plants dispersed throughout the US

22. 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

23. 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

24. Site Factors
Land
Labor
Capital

25. 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?)

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

27. Triangle Shirtwaist Fire of 1911 (New York)
146 workers (majority women) died after being locked in so they couldn’t take breaks etc.
Textile manufacturing (with the exception of wool) is located mostly in the south where wages are considered higher comparable to other jobs

28. What is the difference between skilled and unskilled labor?

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

30. Why do industries face problems?
Key Issue #4

31. Basic Economics on a Global Scale
As demand for a good goes up, the price of that good goes… UP
Is that good for business?
Demand is going down because
1. People already own the goods
2. People’s wages aren’t enough to buy the goods

32. Overproduction
In the past, few countries were making a particular good. Now everyone wants in on the action. This = overproduction
Why do countries want to have their own steel mills for ex?

33. Government Policies
Trading blocs (groups of countries working together to keep countries outside of their group from getting ahold of their markets)
Transnational corporations (bases are primarily in MDCs with factories in LDCs to open markets)
Tax breaks and loans to bring in business to underdeveloped areas

34. Topper the Trick Terrier
Voice Recognition Requirements:
(San Francisco)
Voice Recognition Programming:
(Taiwan)
Plastic Eyes:
(Shenzhen, China)
Plastic Body: (Malaysia)
Speaker for voice:
(Dongguan, China)
Microfiber for Coat: (Korea)
Transistors:
(Shenzhen, China)
Motors for legs:
(Shaoguan, China)
Source: adapted from Eng Ching Kooi (2006) An In-depth Study of the Emergence of Mini-Maestro in Supply Chain Governance and their Influence to Logistics Industry, MA Thesis, State University of New York at Buffalo,
IC chips: (Taiwan)
Plastic legs: (Taiwan)
Wiring: (Dongguan, China)
Packaging: (Hong Kong)

35. Problems that uniquely face LDCs
They are far from large markets
They lack infrastructure
New International Division of Labor (low skilled is clustered in LDCs where higher skilled is in MDCs)

37. Taboo Review
1 minute to get your partner to identify the words/phrases
You CAN’T say the words, you must describe and define the concept so that your partner will guess the word.

38. Partner 1 Break of bulk point Bulk-gaining industry
Bulk-reducing industry
Cottage industry
Fordist
Industrial Revolution
Labor-intensive industry
Maquiladora

39. Partner 2 New international division of labor Post-Fordist
Right-to-work state
Site factors
Situation factors
Textile
Trading bloc
Footloose industry

40. What was the most important innovation of the industrial revolution?
Steam engine, puddling (iron production), railroads, development and use of chemicals, food preservation techniques, others?
Why was this innovation more important or significant than the others?