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industrialization
the process by which economies transform from primarily agricultural societies to ones based on the manufacturing of goods and services
example of industrialization
the development of the textile industry during the industrial revolution
industrial revolution
a series of technological advances in the 18th century
example of industrial revolution
brought former farmers into the cities to work in factories
primary economic sector
extracting natural resources from the Earth
example of primary economic sector
farming, mining, fishing, forestry
secondary economic sector
making products from natural resources
secondary economic sector
manufacturing and building
tertiary sector
Service sector involves the setting of services and skills as well as goods and products from the primary and secondary sectors
Quaternary sector
providing information services such as IT communications, consulting research and development
example of quaternary sector
programmers, IT specialist, & technology developers
quinary sector
top level decisions include government positions, CEOs, CFOs, commerce, and education
example of quinary sector
Elon musk, owner of amazon, and the president of the US
Break of bulk point
The procedure of transferring cargo from one transportation mode to another
least cost theory
suggests that a production point must
be located within a “triangle,” with raw
materials coming from at least two
sources. Weight-gaining industries must
have their production point closer to
the market.
example of least cost theory
a copper smelting plant locating near its raw copper ore source because copper ore is heavy and loses significant weight during the smelting process, making it more cost-effective to minimize transportation of the bulky raw material; this demonstrates a "weight-losing" industry where the production facility should be situated close to the source of the raw material to minimize transportation costs.
core location
a region in the world that holds significant economic power, characterized by high levels of wealth, innovation, advanced technology, and consumption, essentially acting as the center of global economic activity
example of core location
most of Western Europe and North America
semi-periphery
countries that are not as economically developed as core nations but are more developed than peripheral nations.
example of semi-periphery
mexico, brazil, india, and china
periphery location
a country or region on the outer edges of the global economy, typically characterized by low levels of economic development, reliance on exporting raw materials, and a lower standard of living compared to "core" regions
example of periphery location
countries in sub-Saharan Africa, Bolivia, and regions in Southeast Asia
gross domestic product (GDP)
the dollar amount of all final goods and services produced within a country in one year
example of gross domestic product (GDP)
the total value of all goods and services produced within a country like the United States in a year, including things like cars manufactured in Michigan, haircuts provided in California, and food produced by farmers in Iowa, all contributing to the overall economic output of the nation; essentially, the sum of all economic activity within the country's borders.
gross national product (GNP)
the dollar amount of all goods and services produced by a country's citizens in one year
example of gross national product (GNP)
the income of American citizens working in South Korea and the profits from an American-owned factory in Mexico would both count as part of the United States' —-?
gross national income per capita (GNI)
a measure of a country's income divided by its population, representing the average income earned by each citizen in a specific year.
example of gross national income per capita (GNI)
The —— of Bangladesh in 2021 was $2,457.9 and the GNI per capita of the United States was $70,248.6. There is a big difference because its much larger and has a more developed economy
formal sector
the portion of the economy that is monitored by government, so people in it follow regulations and pay taxes.
example of formal sector
banks, multinational corporations (Apple, Samsung, Toyota), public education, and healthcare
informal sector
the portion of the economy that is not monitored by government.
example of informal sector
cleaning your own house, cooking meals for a friend who is sick, drug dealing, and identity theft
infant mortality rate (IMR)
the number of children who die before their first birthday
example of infant mortality rate (IMR)
in Massachusetts, the ___ per 1000 live births dropped from 130 in 1850, to about 4 today
fossil fuels
are natural resources formed from the decomposed remains of ancient plants and animals
example of fossil fuels
coal, oil (petroleum), and natural gas
renewable energy
energy derived from resources that are naturally replenished on a human timescale
example of renewable energy
sunlight, wind, rain, tides, waves, and geothermal heat.
literacy rate
The percentage of population that can read and write (8th grade level or higher)
Example of literacy rate
A country like Canada has a high __ rate of 99% because they are highly developed and so most everyone there can read and write
gender inequality index (GII)
A composite measure of several factors indicating gender disparity: Reproductive health, empowerment, and labor market participation
example of gender inequality index (GII)
the ___ for Switzerland indicates that the country loss only 2.5% of its potential human development as a result of __ in 2019, while Yemen lost 79.5%
human development index (HDI)
measures the status of life in any given place based off life expectancy, education levels and income per capita
example of human development index (HDI)
The United States ___ was 0.927 in 2022, which is very high because of high life expectancy, quality education, and high income (GNI)
microloans
small unsecured loans made primarily to women to help them undertake an income generating project in a developing country
example of microloan
A small loan to rural woman in Bangladesh to purchase a sewing machine to start a tailoring business at home
bostows stages of economic growth
A model that describes the five stages a country goes through to become fully developed: Traditional society, preconditions for takeoff, takeoff, drive to maturity, and age of mass consumption
example of bostow’s stage of economic growth
South Korea, which transitioned from a largely agricultural "traditional society" to a highly industrialized "age of high mass consumption" by investing heavily in infrastructure and manufacturing, experiencing rapid growth during the "take-off" stage, and then diversifying its economy further in the "drive to maturity" phase
wallerstein’s world system theory
a sociological framework that categorizes countries into "core," "semi-periphery," and "periphery" based on their economic roles within a global system
example of wallerstein’s world system theory
Brazil and Mexico act as semi-peripheral countries due to their intermediate level of economic development, acting as a buffer between the core and periphery.
dependency theory
countries do not exist in isolation but are part of an intertwined world system in which all countries are dependent on each other.
example of dependency theory
Africa is still paying its loans to former colonial powers and depicted as a third-world continent while enriching wealthy nations
commodity dependence
When more than 60 percent of a country’s exports are raw materials.
example of commodity dependence
Chile relies on copper exports for economic growth
complementarity
When a country has the income, goods, or services that another country desires
example of complementarity
Canada, with its cold winters and forests of maple trees, is a leading producer of maple syrup but it produces no coffee. Costa Rica, with its tropical climate and rugged terrain, is famous for its coffee, but it produces no maple syrup. Canadian merchants import coffee from Costa Rica while Costa Rican merchants import maple syrup from Canada.
comparative advantage
when parties tend to trade goods or services/the ability to produce a good or service at a lower cost than others
example of comparative advantage
china's workers recieve lower wages than do U.S. workers, so Chinese companies can manufacture goods at a lower cost.
neoliberal policies
a set of reforms that reduced government regulations and taxation.
example of neoliberal policies
eliminating price controls, deregulating capital markets, lowering trade barriers" and reducing, especially through privatization and austerity, state influence in the economy.
free-trade agreements (FTAs)
treaties between two or more countries that aim to reduce or eliminate trade barriers such as tariffs and import quotas
example free-trade agreements (FTAs)
the North American Free Trade Agreement (NAFTA), which allows for free trade between Canada, Mexico, and the United States by eliminating tariffs on most goods traded between these countries.
the European Union (EU)
a political and economic union of 27 European countries that are committed to promoting integration and cooperation among its member states.
World Trade
Organization (WTO)
a global organization that was 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
Mercosur/Southern Common Market
A trade bloc in South America that was established in 1991. The bloc's goal is to create a common market, promote development, and strengthen democracy.
The Organization of the Petroleum Exporting Countries (OPEC)
an intergovernmental organization founded in 1960, consisting of major oil-exporting countries that coordinate and unify petroleum policies among member countries.
tariffs
taxes imposed by a government on imported goods, which raise the price of these goods in order to protect domestic industries and generate revenue
example of tariffs
the United States imposing a tax on imported steel from China, making Chinese steel more expensive to buy in the US, potentially encouraging consumers to purchase domestically produced steel instead
debt crisis
a situation where a country's government accumulates so much debt that it becomes unable to repay its creditors
example of a debt crisis
Greek situation which began in 2009, where the Greek government accumulated significant debt, leading to economic instability and requiring international bailouts; this is often used to illustrate the corruption on a nation's economy and social fabric.
International Monetary Fund (IMF)
created in 1945 to aid countries caught in need of financial assistance.
example of International Monetary Fund (IMF)
the COVID-19 crisis of 2020; much needed emergency funding was provided to 76 countries.
microlending
the process of connecting borrowers with lenders for small loans.
outsourcing
many company workers use contracting work to noncompany employees or other companies to reduce costs
example of outsourcing
a US company hiring a call center in India to handle customer service inquiries
newly industrialized countries (NICs)
a developing country that has moved away from agriculture and raw materials to produce manufacturing goods
example of newly industrialized countries (NICs)
China, a country that has experienced rapid growth and industrialization
special economic zones (SEZ’s)
a designated area within a country where economic regulations differ from those in the rest of the country.
example of special economic zones (SEZ’s)
free-trade zones, export processing zones, industrial parks, and specialized zones.
Export Processing Zones (EPZs)
designated areas within a country that offer favorable conditions for foreign and domestic companies to manufacture and export goods.
example of Export Processing Zones (EPZs)
"maquiladora" zones located along the US-Mexico border; these are manufacturing plants where companies take advantage of lower labor costs in Mexico to produce goods for export to the United States, essentially acting as a dedicated area for export-oriented production.
Rust Belt
a region in the northeastern and midwestern United States that experienced significant industrial decline, particularly in the manufacturing sector, leading to widespread unemployment and urban decay, primarily due to the closure of old factories that were left to rust
International division of labor
transfer of some types of jobs, especially those requiring low paid, less skilled workers, from more developed to less developed countries
example of international division of labor
when a developed country like the US designs and markets high-tech products, while a developing country like China manufactures the components using cheaper labor
Natural resource depletion
The process of using resources faster than they can be replaced
Example of natural resource depletion
Deforestation, fossil fuels, and overpopulation
Mass consumption
The widespread purchase and use of goods and services by a large population
Example of mass consumption
Large scale shopping events like black Friday and cyber Monday
Ecotourism
A sustainable travel approach that focuses on responsible visits to natural areas, conserving the environment, and improving the well-being of local communities
Example of Ecotourism
wildlife viewing, birdwatching, hiking, and camping
The United Nations Sustainable Development Goals (SDGs)
a set of 17 goals that aim to improve the quality of life for people and the planet by 2030
