Unit 7 - Industrialization and Economic Development

Raw Materials

Basic Substances needed to manufacture finished goods

Industrial Revolution

A set of changes in technology that dramatically increased manufacturing productivity

Industrial Belt

Geographical region with large urban areas with a significant workforce along waterways, stretching across the midlatitudes of the northern hemispheres

Deindustrialize

A process of decreasing reliance on manufacturing jobs

Rust Belt

Regions that have large numbers of closed factories especially in the deindustrializing zone

Primary Sector

Work in extracting natural resources from the Earth

Secondary Sector

Work in making products from natural resources

Tertiary Sector

Largest percentage of the US labor force which provides information and services to people

Quaternary Sector

Small percentage of employees that manage and process information usually requiring advanced education or technical skills

Quinary Sector

Small percentage of workers who work in the highest levels of decision-making and include the top officials in various levels of government and business

Multiplier Effect

The potential of a job to produce additional jobs

Least Cost Theory

Alfred Weber’s theory which proposes that factory owners would locate their factories where they could minimize their total costs by balancing transportation costs, labor costs, and maximizing agglomeration economies

Agglomeration Economies

Spatial grouping of businesses in order to share costs

Bulk-reducing Industry

An industry in which the final product weighs less or compromises a lower volume than the inputs (raw material oriented/raw material dependent)

Bulk-gaining industry

An industry in which the final product weighs more or compromises a greater volume than the inputs (market oriented or market dependent industries)

Break of Bulk

Procedure of transferring cargo from one mode of transportation to another

Containerization

System in which goods are loaded into a standardized shipping unit

Intermodal

Containers can be carried on a truck, train, ship, or plane

Footloose

When a business can pack up and leave for a new location easily and quickly

Front Offices

Spaces designated for executives which allow them to interact with executives nearby from other business institutions to impress clients

Gross National Product

Dollar amount of all the goods and services produced by a country’s citizens in one year

Gross Domestic Product

Dollar amount of all final goods and services produced within a country in one year

Per Capita

An amount per person

Informal Sector

The portion of the economy that is not monitored by government

Gini Coefficient

A measure of the distribution of income within a population, the higher the number, the higher the degree of income inequality

Life Expectancy

The number of years a person is expected to live

Literacy Rate

The percentage of the population that can read and write, usually at an 8th grader level or higher

Gender Inequality Index

A composite measure of several factors indicating gender disparity including reproductive health, empowerment, and labor market participation

Human Development Index

Measurement of development that combines economic measure (GNI per capita) with 3 social measures (life expectancy, expected years of schooling, and average years of schooling)

Non-governmental Organizations

Internation non-profit agencies that create programs to support people of different socioeconomic status

Microcredit

A way that non-governmental organizations have helped women by providing loans to start or expand a business

Stages of Economic Growth Model

Theory developed by Walt W. Rostow where economic development is measured from low (stage 1) to high (stage 5) indicating countries develop independently and assuming all countries wanted to modernize and would at different speeds

World Systems Theory

Theory by Immanuel Wallerstein that divides political and economic development of countries from periphery to core, arguing countries have dependence on each other for growth

Core Countries

Includes the economically advantaged area of the world and the center of world business and finances; the headquarters of most large multinational companies located in core countries

Commodity Dependence

Country with more than 60% of its exports are raw materials

Comparative Advantage

Ability to produce a good or service at a lower cost than others

Complementarity

Trade in which both parties have goods or services that the other party desires

Free Trade

Reduction of barriers to trade

Neoliberalism

Political ideas that promote free trade, encouraging policies that reduce government regulations and taxation

Mercosur

Southern Common Market - a trading bloc that includes several South American Countries

World Trade Organization

A global organization created in 1995 to monitor the rules of international trade by providing a forum for negotiating trade deals, settling disputes between its members, supporting the needs of developing countries, and helping companies follow similar international trade policies

International Monetary Fund

A major international financial institution that was created in 1945 to aid countries caught in need of financial assistance

Outsourcing

Contracting work to noncompany employees or other companies for a likely lower cost

Offshoring

Tertiary and quaternary sector companies (usually multinational manufacturing companies) move their back offices to other countries where cost is lower

New International Division of Labor

The changed system of employment in the various economic sectors spread throughout the world due to globalization

Transnational Corporations

Companies that operate in more than one country, have shifted manufacturing jobs away from highly developed countries to the less developed in order to increase profits

Export Processing Zones

Physical spaces within a country where special regulations benefit foreign controlled businesses

Maquiladoras

Name of EPZ in Mexico

Free-Trade Zones

Locations where a foreign company can store, warehouse, transfer, or process without additional taxation of duties if goods are exported

Postindustrial economy

An economy that no longer employs large numbers of people in factories but has people who provide services and process information

Assembly Line

An item in moved from worker to worker, each worker repeatedly performing the same task

Fordism

System of mass production which became standard practice in manufacturing

Post-Fordist

Industrial adaptability due to automation that pushes workers to train in more than one job so they can rotate amongst different workstations during a day

Just-in-time Delivery

System in which the inputs in the assembly process arrive at the assembly location when they are needed

Technopoles

A hub for information-based industry and high-tech manufacturing

Growth Poles

Concentration of high-value economic development in a place that attracts even more economic development

Rust Belt

A region of the United States hit hard by deindustrialization in which metal is set to rust (northeast and areas around the Great Lakes)

Corporate Park

Area in which office buildings congregate together

Sustainable Development

Creating new ways to use Earth’s resources without doing permanent damage to the environment, address problems with depletion of natural resources, mass consumption of goods, pollution, and impacts of climate change

Sustainable Development Goals

17 goals to be achieved in 15 years total, created by the United Nations to increase environmental sustainability across the globe