Unit 7: Services and Urbanization

Development

The process of economic growth, social progress, and improvements in living standards within a country or religion

Developing Country

Nations with a lower level of industrialization, lower income per capita, and a lower human development index (HDI) compared to developed countries

BRICs and NICs

BRICs: 4, large, fast growing emerging countries that became super important in globalization (Brazil, Russia, India, China)
NICs: Nations that recently transitioned from primarily agrarian economies to more industrialized and urbanized economies shows rapid economic growth

Human development index (HDI)

A composite statistic used to measure and rank countries based on their levels of human development

Gross domestic product (GDP)

The total monetary value of all goods and services produced within a country’s borders in a specific time period, typically measured annually.

Gross National Income (GNI)

The total income earned by a nation’s residents and businesses, including only income earned abroad, over a specific period, usually a year.

Purchasing power parity

An economic theory that states in the long run, exchange routes should adjust so that identical goods have the same price in different countries when expressed in a common currency

Brandt Line

An imaginary line that divides the world into: Global North - more developed countries and Global South - Less developed, poorer countries separates. (IMPORTANT: highly racist and should mention when on FRQs)

Primary/Secondary/Tertiary/Quaternary Sectors

Primary: Takes resources straight from nature
Secondary: Turning raw materials into products
Tertiary: Provides services to people
Quaternary Sector: Information, research, and technology

Formal and Informal economy

Formal: Legal, regulated jobs that are taxed, recorded by government, and usually offer worker protection:
Informal: Unregulated, off-the-books work that is not taxed and not protected by labor laws

International division of labor

The international division of labor refers to the way in which tasks and responsibilities for producing goods and services are distributed globally with specific countries specializing in specific industries.

Productivity

The efficiency with which agricultural inputs are converted into outputs, specifically the quantity of crops produced per unit of land or labor

Gender-related development

A measure that assesses gender disparities in human development by comparing the HDI values of women and men

Gender inequality Index

A composite measure that reflects gender disparities in 3 critical dimensions: reproductive health, empowerment, and labor mark of participitation

Rostow’s development model

Rostow’s stages of economic growth is a model proposed by economist Walt Rostow in the 1960s that outlines 5 stages through which all countries progress as they develop economically

Wallerstein’s world systems’ Theory

Wallerstein’s theory that explains global inequality through the interconnected relationship between core, periphery, and semi-periphery nations in the world economy

Core periphery model and dependency model

Divides the world into core countries (wealthy, powerful, high tech economies) and periphery countries (poorer, less-industrialized)

Special Economic Zone

Designated areas within a country that operate under different economic regulations than the rest of the country

World Trade organization

An international organization that oversees global trade agreements, resolves trade disputes, and promotes free trade among member nations

Foreign Direct Investment

When a company or government from one country invests directly in business operations in another country

Transitional Corporation

A company that operates and invests in multiple centuries, with production, offices, or services spread across borders

World Bank

An international financial institution that provides loans and grants to developing countries to support economic development and poverty reduction

OPEC

An international organizations of oil-producing countries that works together to coordinate oil production and influence global oil prices.

Mercosur

A regional trade organization in South America created to reduce trade barriers and promote economic integration among member countries allowing goods to move more freely within the block.

European Union

A political/economic unions of European countries that promotes economic integration, including the free movements of goods, services, labor, one capital among member state

International Monetary Fund

A global organization established in 1944 that aims to promote international monetary corporation, stabilize exchange rates, facilitate balanced trade, and provide financial assistance to countries in economic crisis.

Structural adjustment Program

A set of economic policies required by the international monetary fund or World bank as a condition for providing loans to countries facing financial crises.

Microfinance

The practice of providing small loans, and financial services to low-income individuals or communities who do not have access to traditional banks

Fair Trade

A global movement and certification system that aims to give producers in developing countries better prices, fair wages, and safer working conditions for their goods.

Cooperative store

A business owned and operated by the people who use its goods or services, where profits are shared among members rather than going to outside owners.

UN Sustainable development goals

17 Global goals adapted in 2015 aimed at ending poverty, protecting the planet, and ensuring prosperity for all by 2030

Range

The max distance people are willing to travel to purchase a good/service

Threshold

The minimum # of people needed to support a business or service and keep it profitable

Call center

A centralized office where employees handle large volumes of telephone calls, usually for customer service, technical support, or sales

Back offices-offsharing-outsourcing

Back office: The part of a company that handles internal operations, rather than interacting directly with customers
Offshoring: When a company moves part of its business operations to another country to lower costs
Outsourcing: When a company hires another company to perform certain tasks instead of doing them itself.

Central Place Theory

A theory that explains how cities and towns are located and why they vary in size, based on the services they provide to surrounding populations

Weber’s least-cost theory

A theory stating that industrial location is determined by the place that minimizes production costs, especially: transpotation, labor, and agglomeration costs

Infrastructure (and industry)

Basic physical systems and services needed for a society or economy to function, especially transportation, communication, utilities, and public services

Growth Pole

A specific urban area or industry that stimulates economic development in the surrounding region

Footloose industry

An industry that can choose its location freely because transportation costs, raw materials, and markets are not major factors in its location decision

Bulk-reducing industry

An industry in which the final product weighs less than the raw materials used to produce it so factories are usually located to the raw material sources

Bulk-gaining industry

An industry in which the finished product weighs more or takes up more than the raw materials, so factories are usually located close to the market, customers, to reduce transportation costs

Rust Belt

A region in the NE and Midwest US where heavy industry declined, leaving many factories closed and cities economically struggling

BrownField

The land that used to be used for industrial or commercial purposes but is now abandoned or underused because it may be polluted

Agglomeration economies

The benefits businesses gain by locating near each other in the same city or area. When many related businesses cluster together, it can decrease cost and increase effciency.

Eco-tourism

A form of tourism that focuses on visiting natural areas responsively, conserving environment, and benefiting local communities

Componative advantage

The ability of a country or region to produce a good or service at a lower opportunity cost them others

Vertical Integration

Where a company connects multiple stages of production, from raw materials to final product distribution

Just in time delivery

A manufacturing strategy where materials and components arrive at a factory exactly when they are needed, minimizing storage costs

NAFTA

A trade agreement between the U.S, Canada, and Mexico that eliminated most tariffs and trade barriers to encourages free trade

Fordist/Post - Fordist production

Fordist production: a system of mass production using assembly lines, standardized products, and specialized labor

Outsourcing

The practice of having another company, often in a different country to perform business activities or produce goods that could be done in-house

Right-to-work Laws

Laws in some U.S states that prohibit requiring workers to join a union or pay union dues as a condition of employment

Capital

Money available for investment in businesses, including equipment, factories, and technology used to produce goods

Labor-intensive industry

An industry that requires a large # of workers and human labor to produce goods

Site Factors

Costs related to the physical characteristics of a location, such as land, labor, capital and energy that influence where industries choose to locate

Break-of-bulk Point

A location where goals are transferred from one type of transportation to another

Situation factors

Costs related to transporting materials, products, and accessing markets that influence where industries choose to locate

Assembly Line

A manufacturing process where a product moves through a series of stations and workers each perform a specific task to build the final product

Cottage Industry

A small-scale manufacturing system where goods are produced in people’s homes rather than in large factories

Maquiladora

A foreign-owned factory in Mexico, usually near the U.S border, where companies import materials, assemble products using lower-cost labor, and then export the finished goods

Industrial decentralization

The spatial spread of manufacturing away from traditional core industrial hubs to peripheral or semi-peripheral locations to lower labor costs, access new markets, and avoid agglomeration diseconomies

Per Capita

A Latin term meaning 'per person', and it is often used in statistics and economics to provide a measure that is adjusted for the population size.

Multiplier Effects

The Multiplier Effect refers to the phenomenon where an initial change in spending leads to a larger overall increase in economic activity.