A country can produce particular goods more efficiently than others.
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Agglomeration economies
A localized economy in which a large number of companies and industries cluster together and benefit from the cost reductions and gains in efficiency that result from this proximity.
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Basic industries
Industries that sell their products or services primarily to consumers outside the settlements.
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Break-of-bulk point
A location where transfer is possible from one mode of transportation to another.
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Capitalist class
Those who own the means for producing and distributing goods.
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Working class
Those who sell their labor in exchange for wages.
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Carbon neutrality
A state of net-zero carbon dioxide emissions
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Commodity dependence
An economy that relies on the export of primary commodities for a large share of its export earnings and economic growth.
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Comparative Advantage
The ability of a country to produce particular goods or services at a lower cost than other countries.
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Competitive advantage
A modification of comparative advantage that takes into account the mix of infrastructure, skilled labor, government, domestic demand, levels of domestic competition, agglomeration economies, and other items
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Complementarity
A demand for or deficit in a product in a place and a supply or surplus of the same product in another place
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Containerization
Using standard-size containers to ship goods from port to port.
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Debt crisis
A situation in which past loans’ interest grows so large that countries cannot continue to pay off the debt
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Deindustrialization
A process in which the industrial activity in a country or region is removed or reduced because of a major economic or social change
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Dependency theory
LDCs rely highly on foreign factories and technologies from MDCs to provide employment and infrastructure, causing their economies to not fully develop.
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Ecotourism
A type of tourism that focuses on experiencing natural areas while minimizing the negative environmental impact.
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Export processing zone (EPZ)
Areas established by many countries in the periphery and semi-periphery set up to enhance commercial and industrial exports by encouraging economic growth through foreign investment.
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Financial market
A market in which financial assets (securities) such as stocks and bonds can be purchased or sold
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Fordism
Mass production in which each employee is given a specific task to continuously perform, and has to work at a pace dictated by the speed of the assembly line.
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Free trade agreement
Designated group of countries that have agreed to eliminate tariffs, quotas, and preferences on most (if not all) goods and services between them.
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Free trade zone (FTZ)
Allows for goods from foreign countries to be imported without a tariff, that is, without being taxed for the sake of being foreign goods
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Gender Empowerment Measure (GEM)
Compares the ability of women and men to participate in economic and political decision-making.
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Gender Inequality Index (GII)
A score between 0 and 1 that measures the inequalities women face; low value is low inequality, and high value is high inequality.
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Gross Domestic Product (GDP) and GDP per capita
The value of the total output of goods and services produced in a country in a given time period (normally a year)
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Gross National Income (GNI)
Total income, including investment income (regardless of where earned) and foreign investment and development aid.
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Gross National Product (GNP)
Total value of goods and services by the citizens and corporations of a country as well as foreign investments in a given year.
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Growth Pole
Area of a country where specific industries bring employees thus causing economic growth within the industry as well as the housing market and local economy
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Human Development Index (HDI)
An indicator of the level of development for each country, constructed by the United Nations, combining income, literacy, education, and life expectancy.
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Import substitution industrialization
Government strategy that emphasizes the replacement of some agricultural or industrial imports to encourage local production for local consumption rather than producing for export markets.
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Income distribution
How income is divided among different groups or individuals
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Industrial Revolution
A series of improvements in industrial technology that transformed the process of manufacturing goods.
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Informal sector
Mostly illegal products sold and/or not regulated by the government.
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Formal sector
Regulated and/or taxed by the government.
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International Monetary Fund (IMF)
Monitors global financial developments, provides short term loans to countries, and provides tech advice and training.
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Just-in-time manufacturing
Seeks to reduce inventories for the production process by purchasing inputs for arrival just in time to use and producing output just in time to sell.
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Labor productivity
The quantity of goods and services that can be produced by one worker or by one hour of work
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Labor union
An organized association of workers, often in a trade or profession, formed to protect and further their rights and interests.
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Least cost theory (Weber)
Describes and predicts the location of manufacturing industries based on three factors: transportation costs, labor cost, and the benefit of agglomeration.
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Mass consumption
A large number of people purchasing large quantities of goods.
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Mercosur (or Southern Common Market)
South American organization whose purpose is to expand trade, improve transportation, and reduce tariffs among member countries
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Microloan
Provision of small loans and other financial services to individuals and small businesses in developing countries.
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Multiplier Effects
Describes the expansion of an area's economic base as a result of the basic and non-basic industries located there.
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Neoliberalism
Derives from the idea that government intervention into markets is inefficient and undesirable, and should be resisted wherever possible.
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New International division of labor
The transfer of some types of jobs, especially those requiring low-paid, less-skilled workers, from more developed to less developed countries.
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Nonbasic industries
Industries that sell their products primarily to consumers in the community.
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Offshoring
The practice of relocating business operations and functions to another country, usually an LDC.
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Organization of Petroleum Exporting Countries (OPEC)
A supranational organization that controls the price of oil and petroleum
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Outsourcing
A decision by a corporation to turn over much of the responsibility for production to independent suppliers.
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Post-Fordism
A more flexible set of production practices in which the component of goods are made in different places around the globe and then brought together is needed to meet market demand- brings places closer together in time and space
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Primary sector
The portion of the economy concerned with the direct extraction of materials from the Earth’s surface, generally through agriculture, although sometimes by mining, fishing, and forestry.
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Quaternary sector
Knowledge-based sector, focusing on research and information creation and transfer.
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Quinary sector
Highest decision-making level, includes top officials in business and government.
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Secondary sector
The portion of the economy concerned with manufacturing useful products through processing, transforming, and assembling raw materials.
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Semiperiphery
Countries that offer their citizens relatively diverse economic opportunities, but also have extreme gaps between rich and poor.
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Special economic zone (SEZ)
An area in a country that is subject to different economic regulations than other regions within the same country.
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Sustainable development
The level of development that can be maintained in a country without depleting resources to the extent that future generations will be unable to achieve a comparable level of development.
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Tariff
A tax that a government charges people on import and export goods
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Tertiary sector
The portion of the economy concerned with transportation, communications, and utilities, sometimes extended to the provision of all goods and services to people in exchange for payment.
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Trade embargo
An order issued by a government barring the entry of specific types of imports from a specific country.
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Transnational corporation
A company that conducts research, operates factories, and sells products in many countries, not just where its headquarters or shareholders are located.
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World Systems Theory (Wallerstein)
Explains the spatial relationships between countries and uneven economic development. States that there is one interconnected economy with core, semi-periphery, and periphery countries.
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World Trade Organization (WTO)
Group made up of people from all over the world who together control international trade
Studied by 35 people
