Industry Vocab

Agglomeration (Silicon Valley): Companies in the same industry clustering together, like tech companies in Silicon Valley, to gain benefits from being near each other.

Agglomeration Diseconomies: Problems that occur when too many businesses cluster in one area, causing traffic jams, pollution, and high rent.

Ancillary Activities: Support businesses that spring up around a main industry (like restaurants near a stadium).

Cumulative Causation: How successful places keep getting more successful - when one business succeeds in an area, it attracts more businesses and investment.

Base Ratio: The relationship between jobs that bring money into a region (exports) and jobs that just circulate money within the region (local services).

Basic vs. Non-Basic Sectors: Basic sectors bring new money into a region through exports (car plant); non-basic sectors provide local services that recycle money already in the region (hairdressers, waitresses, babysitters)

Brain Drain: When talented, educated people leave developing countries for better opportunities elsewhere, hurting their home country's economy.

Break of Bulk Point: A place where large shipments are broken down into smaller ones and transferred between transportation types, often becoming important economic centers.

Brick and Mortar vs. e-Commerce: Traditional physical stores versus online shopping, changing how and where retail happens.

BRICS: Brazil, Russia, India, China, and South Africa - large developing economies with growing global influence.

Bulk Gaining Industries: Industries where the product weighs more than its ingredients (like soda) therefore being located close to the market

Bulk Reducing Industries: Industries where the product weighs less (like metal refining) therefore being located closer to raw materials

Localization Economies: Cost savings when similar businesses cluster together and share resources, workers, and knowledge. (Consider urban agglomerations across the US)

Comparative Advantage: the ability of a region to produce a good at a lower opportunity cost than others. (why American flags might be made overseas).

Core-Periphery Model: A pattern where wealthy, powerful "core" regions control and often exploit less-developed "peripheral" regions.

Digital Divide: The gap between people who have access to modern technology and those who don't.

Backwash Effect: When successful areas pull resources, talent, and money away from struggling areas, making them fall further behind.

Deindustrialization: When manufacturing jobs disappear from a region, forcing economic change and economic reinvention (American Rust Belt).

Deglomeration: When businesses move away from crowded city centers to avoid high costs and congestion.

Cottage Industry: Small-scale production that happens in people's homes rather than in factories, often using traditional methods.

Sustainable Development: Economic growth that doesn't harm the environment or use up resources future generations will need.

Primary, Secondary, Tertiary Sectors: Resource extraction (farming, mining), manufacturing, and services - how these are distributed shows a country's development level.

Ecotourism: Travel that protects natural environments and helps local communities rather than harming them.

Export Processing Zones (EPZ): Special areas where foreign companies can build factories with tax breaks and fewer regulations, designed to attract investment.

Transnational Corporations (TNCs): Giant companies that operate in multiple countries, often more powerful than some governments.

Factory Location Considerations: What businesses think about when deciding where to build factories: labor costs, transportation, geography, and government incentives.

Fast World vs. Slow World: The division between places connected to global information networks and those left behind.

Foreign Direct Investment: When companies or individuals from one country build or buy businesses in another country.

Fordism: Manufacturing using assembly lines where each worker repeatedly performs one simple task, named after Henry Ford's car factories.

Footloose Industries: Businesses that can locate almost anywhere because their products are lightweight, valuable, or digital.

Formal Economic Activities: Business transactions that are legal, taxed, and counted in official statistics like GDP

Informal Economic Activities: Economic activity that happens "off the books" - not taxed, regulated, or counted in GDP (like street vendors or day laborers).

Four Tigers: Hong Kong, Singapore, South Korea, and Taiwan - countries that rapidly transformed from poor to wealthy through manufacturing and trade.

Gross Domestic Product (GDP): The total value of all goods and services produced within a country's borders.

Gross National Product (GNP): The total value produced by a country's people and companies, even when they're working abroad.

Purchasing Power Parity (PPP): A way to compare living standards across countries by looking at what money can actually buy locally (like comparing the cost of a Big Mac).

Gross National Income (GNI): GDP plus money citizens earn abroad, minus what foreigners earn in the country and take home.

Gender Inequality Index (GII): A measure of how women fare compared to men in health, education, and jobs in different countries.

Human Development Index (HDI): A score that combines life expectancy, education, and income to measure overall quality of life, not just economic output.

Industrialization: When a society shifts from farming to manufacturing, typically becoming more urban with smaller families.

Industrialized Countries: Nations where manufacturing and services dominate the economy instead of agriculture.

Infrastructure: The basic systems a society needs to function - roads, bridges, electricity, water, internet, etc.

Intervening Opportunities: Closer options that catch migrants or consumers before they reach farther destinations (choosing a local amusement park instead of traveling to Disney World).

Call Centers: Offices where employees answer customer calls, often located in places with lower wages but good English skills.

Manufacturing Region: An area specialized in making certain products, like the Rust Belt (steel, cars) or China's east coast (electronics).

NAFTA: Agreement removing trade barriers between the US, Canada, and Mexico, making it easier to sell goods across borders.

Neocolonialism: When wealthy countries control poorer ones through economic pressure rather than direct political rule.

Offshore Financial Centers: Small countries or territories that attract foreign money with minimal regulation and low taxes

Outsourcing: Hiring an outside company to perform functions previously done in-house, often to save money.

Rostow's Stages of Development Model: Theory that all countries follow five steps from traditional society to mass consumption, criticized for assuming all places develop the same way.

Service Offshoring: Moving service jobs (like customer support) to cheaper locations abroad while serving customers in the original country.

Spatially Fixed vs. Spatially Variable Costs: Costs that stay the same no matter where you locate (like machinery) versus costs that change based on location (like labor or shipping).

Transition of the Global Economic Core: How the center of world economic power has shifted over time - from the Mediterranean to Western Europe to North America to increasingly East Asia. (See Image Below)

Urbanization Economies: Benefits businesses get from being in cities, like shared infrastructure and access to diverse workers and services.

Weber's Least Cost Theory: Model showing that factories locate where transportation, labor, and other costs are minimized.

World Systems Theory: Model dividing countries into powerful "core," middling "semi-periphery," and exploited "periphery" based on their role in global capitalism.

Structuralist Theory: Idea that poor countries stay poor because the global economic system is designed to benefit rich countries.

Maquiladoras: Factories along Mexico's border with the US that import materials, assemble products using cheap labor, and export the finished goods.

Special Economic Zones: Designated areas with business-friendly regulations to attract foreign companies and boost economic growth.

Growth/Techno Pole: Planned centers of high-tech innovation designed to spark development in surrounding regions.

Millennium Development Goals: UN targets for reducing poverty, hunger, disease, and inequality worldwide by 2015.

Trafficking: Illegal transportation of people, drugs, weapons, or wildlife across borders.

Intermodal Connections: Places where goods transfer between different transportation types (ship to train to truck) to move efficiently.

Neoliberalism: Economic approach emphasizing free markets, privatization, and minimal government regulation.

Island of Development: A prosperous area surrounded by much poorer regions, creating stark contrasts.

Non-Governmental Organizations: Private groups addressing social or environmental issues independent from governments.

Microcredit Program: System providing tiny loans to poor entrepreneurs who can't get traditional bank loans (like Grameen Bank).

Flexible Production Systems: Manufacturing that can quickly adapt to changing customer demands instead of mass-producing identical items.

Just-In-Time Delivery: Production method where parts arrive exactly when needed rather than being stored, reducing warehouse costs.