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Industrial Revolution

Shift beginning in the mid-1700s where economies moved from farming/hand production to factory machine production.

Agrarian Economy

Economy based mainly on farming and agriculture.

Industrial Economy

Economy based on manufacturing and factory production.

Mechanization

Replacing human labor with machines to increase production.

Mass Production

Producing large quantities of goods quickly and cheaply using machines.

Factory System

Centralized production system where goods are made in factories with machines and wage labor.

Agricultural Revolution

Period of improved farming technology that increased food supply and freed workers for industry.

Enclosure Movement

Privatization of farmland in England that pushed rural workers into cities.

Berlin Conference

1884–1885 meeting where European powers divided Africa into colonies.

Colonial Extraction Economy

System where colonies supply raw materials to colonizers and buy finished goods.

Wage Labor

Work where people earn money instead of producing their own goods.

Primary Sector

Extraction of raw materials (farming, fishing, mining).

Secondary Sector

Manufacturing and processing of raw materials into goods.

Tertiary Sector

Service jobs providing intangible products (education, retail, healthcare).

Quaternary Sector

Knowledge-based jobs requiring high education (research, tech, finance).

Quinary Sector

Top-level decision-making jobs (CEOs, high government officials).

Industrialization

Growth of secondary sector jobs and factory production.

Postindustrial Economy

Economy dominated by services and knowledge sectors.

Service Economy

Economy dominated by tertiary and quaternary jobs.

Deindustrialization

Decline of manufacturing jobs and factories in a region.

Core

Highly developed, wealthy countries with strong services and political power.

Periphery

Less developed countries dependent on raw materials and low-wage labor.

Semi-Periphery

Middle-development countries with growing industry and mixed economic sectors.

Global North

Wealthy, developed, politically powerful countries.

Global South

Less developed countries with lower income and more dependency.

Uneven Development

Global pattern where some regions develop faster than others.

Global Division of Labor

Pattern where core controls management/tech while periphery does labor/resource extraction.

International Division of Labor

Similar concept: work is divided globally based on development levels.

GDP (Gross Domestic Product)

Total value of goods/services produced within a country’s borders.

GNP (Gross National Product)

Total value produced by a country’s citizens/companies anywhere in the world.

GNI (Gross National Income)

Total income earned by a country’s citizens, including foreign investments.

GDP per Capita

Average output per person; common development indicator.

GNI per Capita

Average income per person; useful for comparing development.

Income Distribution

How evenly wealth is spread in a population.

Gender Inequality Index (GII)

Measure of inequality between men and women in health, empowerment, and labor.

Human Development Index (HDI)

UN measure combining income, education, and life expectancy.

Formal Economy

Legal, regulated, taxed economic activity.

Informal Economy

Unregulated economic activity not recorded by government.

Street Vendor Economy

Common informal economy example in developing countries.

Cash Economy

Economy where transactions occur in cash without official records.

Underground Economy

Economic activity hidden from government, often informal or illegal.

Subsistence Agriculture

Farming where crops are grown mainly to feed the farmer’s family.

Commercial Agriculture

Farming focused on selling crops for profit.

Microenterprise

Small business, often supported by microloans.

Gender Parity

Equal access to education, jobs, and rights between genders.

Microloan (Microlending)

Small loan given to poor individuals (often women) to start a business.

Demographic Impact of Women’s Education

Educated women marry later and have fewer children.

Rostow’s Stages of Growth

Model arguing all countries develop through five stages of industrialization and modernization.

Traditional Society (Rostow)

Subsistence farming, low technology, low productivity.

Preconditions for Takeoff (Rostow)

Infrastructure begins, investment rises.

Takeoff (Rostow)

Rapid industrial growth and economic expansion.

Drive to Maturity (Rostow)

Economy diversifies and becomes more stable.

Age of Mass Consumption (Rostow)

High consumerism and service economy dominance.

Modernization Theory

Idea that development happens when countries adopt Western technology and industry.

Dependency Theory

Theory that periphery remains poor because core exploits it economically.

World-Systems Theory

Wallerstein’s theory that capitalism creates a global system of core, semi-periphery, and periphery.

Commodity Dependence Theory

Countries relying heavily on exporting raw commodities stay underdeveloped.

Commodity

Raw material or agricultural product sold on global markets (oil, coffee, minerals).

Price Volatility

Unstable pricing that fluctuates frequently, common in commodities.

Microeconomy

Economy dependent on one or few exports, making it vulnerable.

Least Cost Theory (Weber)

Factories locate where transportation and production costs are minimized.

Weber Triangle

Model showing factory location based on raw materials and market location.

Bulk-Reducing Industry

Industry where raw materials weigh more than final product; locates near resources.

Bulk-Gaining Industry

Industry where finished product weighs more; locates near market.

Fragility Factor

Idea that fragile goods are produced near markets to prevent damage.

Break-of-Bulk Point

Location where goods transfer between transportation methods (port, rail hub).

Intermodal Transportation

Shipping using multiple transport methods (ship + rail + truck).

Containerization

Use of standardized shipping containers that lowered shipping costs and boosted globalization.

Shipping Network

Global routes and infrastructure that connect trade through oceans and ports.

Outsourcing

Moving production to another country to reduce labor and production costs.

Offshoring

Relocating business processes to another country (similar to outsourcing).

Global Restructuring

Shifting of industrial production from core to periphery/semi-periphery.

Rust Belt

U.S. region where manufacturing declined due to deindustrialization.

Fordism

System of mass production of standardized goods (assembly line production).

Post-Fordism

Flexible production spread across multiple countries.

Just-in-Time Delivery

Producing goods only when needed to reduce storage costs.

Multiplier Effect

One job creates additional jobs indirectly through local economic growth.

Agglomeration Economies

Benefits industries gain by clustering together in one region.

Industrial Cluster

Group of related businesses located close together.

Growth Pole

Region of rapid economic growth that spreads development outward.

Technopole

High-tech growth pole, often tied to research and innovation.

Complementarity

Trade occurs because countries have goods/resources the other lacks.

Comparative Advantage

Countries specialize in goods they produce most efficiently.

Economies of Scale

Cost advantages gained by producing goods in large quantities.

Trade Barrier

Any restriction on trade (tariffs, quotas, regulations).

Trade War

Cycle of retaliatory tariffs between countries.

MERCOSUR

South American trade bloc designed to reduce tariffs between member states.

OPEC

Organization of major oil-exporting countries that influences global oil prices.

WTO (World Trade Organization)

Global organization that regulates and promotes international trade.

IMF (International Monetary Fund)

Global financial institution that stabilizes economies through loans and restructuring.

Economic Interdependence

When economies rely on each other through trade and investment.

Global Financial Crisis (2007–2008)

Worldwide recession caused by risky U.S. housing loans and bank collapse.

Subprime Mortgage

High-risk loan given to borrowers likely to default.

Recession

Significant economic decline lasting months or longer.

Debt Crisis

When a country cannot repay loans, causing economic instability.

SEZ (Special Economic Zone)

Area with special economic rules to attract foreign investment.

EPZ (Export Processing Zone)

SEZ focused on producing goods for export.

FTZ (Free Trade Zone)

Tax-free area for storing/assembling goods for export.

Foreign Direct Investment (FDI)

Investment by a company in another country’s business/factories.

Sustainability

Meeting current needs without harming future generations’ ability to meet theirs.