Unit 7: Industrial and Economic Development Patterns and Processes

Industrial Revolution

Major shift from hand production to machine-based manufacturing, powered first by water and later by fossil fuels (especially coal), reshaping where people live and work.

Industrialization

The process of building machine-based manufacturing systems (factories, energy use, transport links, labor organization) that transform economies and spatial patterns.

Factory system

Production organized in centralized workplaces that concentrate workers and machines, enabling large-scale manufacturing.

Urbanization

Growth of cities as factories and related jobs pull people from rural areas into urban centers.

Core–periphery (industrial geography)

Spatial pattern where core regions concentrate industry and wealth while peripheral regions often specialize in extraction or low-wage production.

Energy access

Availability of reliable power (early water mills; later coal/steam) that enables factories to operate at large scales.

Capital investment

Money and financial support (banks, merchants, stable property systems) needed to build factories, buy machines, and expand production.

Transportation infrastructure

Canals, railroads, ports, and highways that reduce shipping costs and connect raw materials, factories, and markets.

Institutions and government policy

Laws, patents, property systems, and state investment that can support or hinder industrial growth.

Second Agricultural Revolution

Agricultural innovations and mechanization that increased productivity and reduced farm labor needs, reinforcing migration to industrial cities.

Rural-to-urban migration

Movement of people from countryside to cities, often driven by declining farm labor demand and rising factory labor demand.

Trade union

Worker organization that advocates for higher wages and better working conditions in industrial economies.

Commodity chain

The linked steps of production and exchange from raw materials to processing, transport, retail, and consumers (often across multiple regions/countries).

Value capture

Who earns the greatest share of profit along a commodity chain; often concentrated at processing/branding/retail rather than at producers.

Nonrenewable resource

Resource that does not replenish on human timescales (e.g., fossil fuels, many minerals), though some materials can be recycled.

Renewable energy

Energy sources that can be sustained if managed properly (e.g., solar, wind, tidal, geothermal; sometimes contrasted with fossil fuels).

Sustainable development

Improving lives today without preventing future generations from meeting their needs; includes environmental, economic, and social dimensions.

Value-added processing

Increasing a product’s value by transforming raw materials into higher-value manufactured goods (a hallmark of manufacturing).

Primary sector

Economic activities that extract natural resources (farming, fishing, logging, mining, energy extraction).

Secondary sector

Manufacturing and processing (factories, construction) that transform primary-sector raw materials into finished or semi-finished goods.

Tertiary sector

Service activities (retail, healthcare, education, transportation, banking) that provide intangible outputs and distribute goods to consumers.

Quaternary sector

Information and knowledge work such as research, IT, data analysis, and some high-level management.

Sectoral composition

The mix of primary, secondary, and service employment/GDP in an economy; used to interpret how economies change over time.

Globalization (economic shift mechanism)

Increasing global integration that can move manufacturing to lower-cost regions while higher-profit functions (finance, design, R&D) remain in higher-cost regions.

Deindustrialization

Shift away from manufacturing as the main source of jobs and/or production in a region, often tied to offshoring, automation, and competition.

Gross Domestic Product (GDP)

Dollar value of all goods and services produced within a country in one year (a measure of domestic economic output).

Gross National Income (GNI)

Total income earned by a country’s residents, including income from abroad (often used for cross-country comparisons).

GDP per capita

GDP divided by population; an average output/income measure that can hide inequality within a country.

Purchasing Power Parity (PPP)

Adjustment that accounts for cost-of-living differences across countries so incomes reflect what people can actually buy.

Human Development Index (HDI)

UN index (0.00–1.00) combining income and social indicators (health and education) to measure development beyond income alone.

Gini coefficient

Measure of income inequality between richest and poorest groups (often scaled so higher values mean more unequal).

Newly Industrialized Country (NIC)

Country that has rapidly shifted from agriculture toward manufacturing (and sometimes services), often with fast urbanization and infrastructure growth.

Foreign direct investment (FDI)

Investment by a firm in facilities/operations in another country (e.g., building a factory or buying a controlling stake).

Technology transfer

Provision of technical knowledge, training, and industrial equipment to increase efficiency and capacity in another country’s firms or agencies.

Credit crunch

Sudden reduction in lending/investment as banks and investors withhold funds, drying up money for factories and infrastructure.

Modernization theory

Idea that development follows a path similar to today’s high-income countries through industrialization, infrastructure, education, and market integration.

Rostow’s Stages of Growth

Modernization model proposing five stages from traditional primary economies to an age of mass consumption, emphasizing investment and industrial takeoff.

Dependency theory

Theory that poorer countries can be kept dependent through unequal economic relationships, often relying on MDC loans, investment, and foreign-owned industry.

Prebisch thesis

Dependency-related argument emphasizing how Third World economies can become reliant on First World loans/investment and TNC influence (economic imperialism).

World-systems theory

Wallerstein’s framework describing a hierarchical global economy of core, semi-periphery, and periphery roles shaped by unequal divisions of labor.

Neoliberalism

Policy approach emphasizing freer markets and reduced state intervention (privatization, lower trade barriers, attracting FDI), with debated social impacts.

Transnational corporation (TNC)

Company operating in multiple countries that coordinates production, marketing, and finance across borders.

Global production network

System where different stages of making a product (inputs, parts, assembly, branding, retail) occur in different places, shaping who gains profit and who bears costs.

Special Economic Zone (SEZ)

Designated area offering incentives (tax breaks, fewer regulations, improved infrastructure) to attract export-oriented investment and industry.

Outsourcing

Contracting work out to another company (not necessarily in another country).

Offshoring

Moving work or production to another country to reduce costs or access markets.

Agglomeration economies

Benefits firms gain by clustering (shared skilled labor pool, specialized suppliers/services, shared infrastructure, knowledge spillovers).

Weber’s Theory of Industrial Location

Least-cost location theory (1909) arguing firms choose sites to minimize land, labor, resource, and transportation costs; includes weight-losing vs weight-gaining logic.

Just-in-time (JIT) production

Production system where parts are delivered to assembly plants as needed, increasing reliance on efficient transportation and supplier networks.

Ecologically unequal exchange

Pattern where wealthier regions consume goods while environmental burdens (extraction, pollution) are borne elsewhere along global supply chains.