terms marked with * are not vocab terms from textbook
Industrial Revolution
rapid transformation of economy thru introduction of machines, new power sources & chemical processes in Europe & U.S. around late 18th century
textile
fabric woven from wool, cotton or flax fibers
labor productivity
average amount of goods & services produced per worker per unit of time
fossil fuels
natural fuels derived from fossilized remains of living organisms
crude oil
yellow-black liquid fossil fuel found in geologic deposits
mass consumption
purchase of large amounts of mass-produced goods by large amounts of ppl
international division of labor
situation where differing regional labor forces complement each other in interdependent global economy
commercial farmers
farmers that raise crops & livestock to sell @ market for profit
wage labor
socioeconomic relationship where employers pay workers to do a task
working class
ppl who depend on wage labor to obtain basic necessities
capitalist class
ppl who own means of production & pay wages of workers
middle class
ppl either salaried professionals or office wage workers
labor unions
associations of workers in particular industries established to collectively bargain w/ capitalists
mass production
machine manufacture of identical products in large quantities
assembly line
system of manufacturing where parts & procedures are added one step at a time thru series of workstations
economic sectors
groupings of industries based on what’s produced & activities of workforce
primary sector
industries that extract natural resources from environment
e.g. fishing
secondary sector
process raw materials extracted by primary sector, transforming into finished & usable forms
e.g. milling logs into lumber
tertiary sector
provide services to businesses & consumers
e.g. lawyers
quaternary sector
provides intellectual & informational services
e.g. biomedical research
quinary sector
highest-level management decisions are made in areas of business, gov’t, education, science
e.g. CEO
base industry
disportionate economic importance & whose existence other industries depend on
semi-periphery
countries or regions whose economics have elements of both core & periphery
containerization
system of cargo transport that is compatible w/ different transport options using shipping containers
break-of-bulk point
location where bulk cargo is transferred from one mode of transportation to another
least-cost theory
Alfred Weber’s theory that transportation costs & labor costs play strong role in determining location of manufacturing cities
Weber’s location triangle*
if material is heavier, manufacturing locations = closer to raw materials & vice versa
Rostow’s stages of economic growth*
suggests all countries eventually progress similarly thru 5 development stages
ending in wealthy, mass-consumption societies
progression of Rostow’s stages of economic growth*
- 1st stage based on subsistence agriculture
- followed by increasingly industrialized & economically diverse stages
- 5th stage based on mass consumption & service sector becomes dominant
world systems theory
Wallerstein’s theory of economic development grouping countries into core, semi-periphery or periphery
dependency theory
states periphery is poor bc of economic dependence on core in unequal relationship established from colonialism & imperialism
commodity dependence
occurs when commodities account for more than 60% of value of country’s total exports
gross national product (GNP)
total value of all goods & services made by country’s residents & businesses in a specific time period
gross domestic product (GDP)
total value of all goods & services produced within a country over specific time period
gross national income (GNI)
total income of country’s residents & businesses, regardless of where it was earned & aid received from abroad
GDP per capita
country’s GDP divided by total population
purchasing power parity (PPP)
measures how much a common “basket of goods” costs locally in the currency of each country being compared
Gender Inequality Index (GII)
statistical measure of gender Inequality combining data on reproductive health, empowerment, labor-market participation
Human Development Index (HDI)
statistical measure of human achievement combining data on life expectancy at birth, education levels & GNI per capita
informal sector
part of any economy not officially reported to gov’t
formal sector
part of any economy officially reported to gov’t
Gender Empowerment Measure (GEM)
measurement of gender equality including proportion of seats held by women in parliament, percent of women in economic law making positions & women vs. men’s share of earned income
gender parity
way of documenting progress toward gender equality using access to education, average incomes for women vs. men & workforce participation
microloan
very small loan to poor ppl w/ little income or collateral, intended to help them establish or expand small business
mercantilism
theory of trade stating each country strives to export more than it imports to accumulate wealth
protectionism
trade rules that restrict imports to protect domestic industries, central to mercantilism
absolute advantage
nation’s ability to produce goods or services more efficiently than other nations
comparative advantage
country’s ability to produce one product more efficiently than it can produce other products
complementarity
measure of how well a country’s export profile matches another country’s import profile
transnational corporation (TNC)
firm w/ power to coordinate & control operations domestically & internationally
e.g. Toyota
competitive advantage
firm’s relative ability to outperform other TNCs in its industry
neoliberalism
range of pro-market & anti-gov’t stances on economy
International Monetary Fund
international organization seeking to promote global economic cooperation, financial stability & sustainable economic growth
World Bank
provides funding & expertise to promote sustainable economic growth in developing countries
World Trade Organization
regulates trade and encourages global trade cooperation
free-trade agreement
treaty btwn 2 or more countries that reduce tariffs & promotes foreign investment
tariffs
tax on imported goods & services
customs union
free-trade agreement among 2 or more member countries + combined w/ common external trade policy for nonmembers
Mercosur
South American customs union including Argentina, Brazil, Paraguay, Uruguay
Organization of the Petroleum Exporting Countries (OPEC)
intergovernmental organization created to coordinate & unify petroleum policies among members
trade embargo
official ban on trade on specific country or good
financial market
any marketplace where financial products are traded
debt crisis
occurs when gov’t debts exceed its tax revenues where it cannot meet loan payments
import substitution industrialization (ISI)
economic development policy w/ goal of replacing imported goods w/ domestically produced goods to spur industrialization & reduce dependence on other countries
Fordism
economic & social arrangement based on mass production, mass consumption and high factory employment
corporate disinvestment
process where companies stop investing in factory upgrades & begin selling off assets
offshoring
relocation of manufacturing & support services from one country to another
outsourcing
transfer of part of a firm’s internal operations to 3rd party
deindustrialization
decline of employment in manufacturing sector in core’s industrial centers
special economic zones (SEZ)
specific area within country’s borders where business & trade laws are different than rest of country
new international division of labor
spatial shift in manufacturing from developed to developing countries
export processing zones (EPZ)
industrial zone w/ incentives to attract foreign investment where imported materials are processed or assembled before getting re-exported
free-trade zones (FTZ)
specially designated duty-free area that provides warehousing storage & distribution facilities for goods intended for trade or reexport
post-Fordism
shifts from manufacturing centers & mass production to more flexible production processes
e.g. specialized batch production
just-in-time-manufacturing (JIT)
production in small batches as needed by customer demand
high-technology industry
industry that uses most advanced technology & has highest levels of research/development
e.g. aerospace
agglomeration economy
occurs where firms cluster together in a place for its geographic concentration of skilled labor & those involved in the industry
e.g. Silicon Valley
multiplier effect
creation of new business & jobs in other industries from investment in a different industry
growth poles
geographically identifiable centers of economic activity organized around designated industry
sustainable development
meets consumption needs without compromising ability of future generations to meet their own
resource depletion
consumption of natural resources faster than they can be replenished
environmental pollution
contamination of physical & biological parts of environment
point source pollution
identifiable source of where contaminants come from
nonpoint source pollution
contamination coming from multiple, spread out sources
climate change
long-term shift in global or regional climate patterns
cogeneration
production of 2 forms of energy from 1 fuel
carbon neutrality
achieving zero CO2 releases thru emissions reduction & carbon removal
carbon offsets
processes that remove or store carbon from atmosphere to make up for CO2 emissions elsewhere
ecotourism
travel to natural areas of ecological value in support of conservation efforts & socially just economic development