Unit 7 ALL vocab

Agglomeration – When businesses from the same industry cluster in one area to reduce costs (e.g. labor pool, infrastructure, suppliers).

Break-of-Bulk Point – A place where cargo is transferred between transport types (e.g. ship to truck), often near ports or major cities.

Bulk-Reducing Industry – Industry where inputs weigh more than the final product; located near raw materials (e.g. copper, steel).

Bulk-Gaining Industry – Industry where the final product is heavier or bigger; located near markets (e.g. soda bottling, car manufacturing).

Commodity – A raw material or primary product that is traded, often globally (e.g. oil, cotton, coffee).

Commodity Chain – The steps in producing and distributing a product: extraction → production → distribution → consumption.

Comparative Advantage – A country’s ability to produce a good at a lower opportunity cost than others.

Complementarity – When two areas can trade goods or services each needs (e.g. oil from Saudi Arabia, food from U.S.).

Dependency Theory – Core countries exploit periphery ones, keeping them poor and dependent through trade and investment patterns.

Economies of Scale – The more you produce, the cheaper it becomes per unit (used in big businesses & factories).

Economic Restructuring – Shift from manufacturing (secondary sector) to services (tertiary and above), often in developed countries.

Ecotourism – Environmentally friendly tourism that supports conservation and local culture.

European Union (EU) – A political-economic union of European countries promoting free trade, open borders, and economic cooperation.

Export Processing Zones (EPZs) – Areas in developing countries with favorable trade conditions to attract foreign companies (low taxes, no tariffs).

Formal Economy – Legal economy with taxed and regulated jobs (e.g. retail, office work).

Free Trade Zones (FTZs) – Zones where goods can be imported/exported without tariffs to encourage trade.

Gender Inequality Index (GII) – Measures gender inequality based on reproductive health, empowerment, and labor market participation.

Gini Coefficient – Measures income inequality (0 = perfect equality, 1 = total inequality).

Gross Domestic Product (GDP) – Total value of goods/services produced within a country's borders in a year.

Gross National Income (GNI) – GDP + income earned by citizens abroad – income sent to foreign countries.

Gross National Product (GNP) – Total value of all goods/services produced by a country's citizens, no matter where they live.

Growth Pole – A high-tech or innovative region that attracts investment and spurs economic growth around it (e.g. Silicon Valley).

Human Development Index (HDI) – Composite measure of development: life expectancy, education, and income.

Informal Economy – Unregulated, untaxed jobs (e.g. street vendors, babysitting).

International Division of Labor – Global shift of manufacturing to developing countries and services to developed countries.

Just-in-Time Delivery (JIT) – Goods arrive exactly when needed to reduce storage costs (used in car factories).

Least Cost Theory (Weber) – Companies choose factory locations to minimize transportation, labor, and agglomeration costs.

Mass Consumption – A stage of economic development with high production and widespread consumer purchasing.

Maquiladoras – U.S.-owned factories in Mexico near the border that import materials duty-free and export finished goods.

Microloan – Small loans given to people in developing countries to start small businesses, especially for women.

Multiplier Effect – Investment in one area (e.g. factory) leads to job creation in others (e.g. stores, transportation).

Neoliberal Economic Policies – Free-market reforms like privatization, free trade, and reduced government intervention.

Newly Industrialized Countries (NICs) – Nations transitioning from agriculture to manufacturing (e.g. Mexico, Brazil, India).

Offshoring – Moving company operations to other countries to cut costs.

OPEC – Organization of Petroleum Exporting Countries; controls oil supply and prices globally.

Outsourcing – Hiring external companies or workers (often abroad) to handle business tasks.

Post-Fordism – Flexible, specialized production with diverse products and global supply chains (opposite of assembly lines).

Primary Sector – Extracting raw materials (e.g. farming, fishing, mining).

Quaternary Sector – Knowledge-based services (e.g. research, IT, education).

Quinary Sector – High-level decision-making jobs (e.g. CEOs, government officials).

Rostow’s Stages of Economic Growth – 5 stages from traditional society to mass consumption (linear model of development).

Service Sector – Jobs that provide services rather than goods (includes tertiary, quaternary, and quinary sectors).

Special Economic Zones (SEZs) – Areas with tax breaks and relaxed regulations to attract foreign businesses (e.g. Shenzhen, China).

Sustainable Development – Economic growth that meets needs without harming future generations or the environment.

Tariff – A tax on imports or exports to protect domestic industries.

Tertiary Sector – Services like retail, banking, education, and tourism.

USMCA – Trade agreement between U.S., Mexico, and Canada (replaced NAFTA).

Wallerstein’s World Systems Theory – Core, semi-periphery, and periphery countries exist in a global economic hierarchy.

World Trade Organization (WTO) – International group promoting global free trade and resolving disputes.