Human Geography Unit 6

Chapter 11: Industry and Manufacturing                Where is Industry Distributed? o Definition: A series of improvements in industrial technology that transformed the process of manufactured goods Before the Industrial Revolution industry was geographically dispersed across the landscape People made household tools and agricultural equipment in their own homes Home based manufacturing was known as the Cottage Industry System o Origin of Industry The Industrial Revolution begins with innovative engineers and mechanics, invention of hundreds of mechanical devices, expansion in productivity which resulted in higher standards of living Begins in Northern England and Southern Scotland during the 18th century Rapidly disused to Europe and North America The modern concept of industry means the manufacturing of goods o Catalyst of Industrial Revolution Technology and Invention Steam Engine- James Watt Unprecedented expansion in productivity Substantially higher standard of living Term Industrial Revolution Can Be Misleading Changes are more than industrial; new social, economic and political patterns emerge Changes involve gradual diffusion of new ideas and techniques over decades rather than instantaneous o Early Industries Impacted Iron Coal Transportation Canals Railroads Textiles Chemicals Dyes for cloth Food processing Canning                              o Europe’s Industrial Regions UK Rhine-Ruhr Valley Mid-Rhine Northern Italy-Po River Basin North Eastern Spain-Catalonia Moscow St. Petersburg Volga Industrial District Urals Kuznetsk Donetsk: Eastern Ukraine Silesia o North America’s Industrial Regions New England Mid-Atlantic I-95 Corridor Mohawk Valley, New York Connects Hudson Valley with Erie Canal Cheap energy Niagara Falls Pittsburgh-Lake Erie Rust Belt Western Great Lakes Chicago Rust Belt Southern CA Canada’s Industrial Areas St. Lawrence Valley-Ontario Peninsula o Asia’s Industrial Regions Japan China South Korea Large Labor Force Produce Large Amount of goods at cheap prices Highly skilled workers; but at lower wages Electronics, automobiles, ships Clustered along coast o Important Factors in Industry What are the characteristics of the land, labor, and capital Location- Where are markets located and where are resources located           Industry’s starting to shift from MDC’s to LDC’s- Global Markets Why are Situation and Site Factors Important? o Situation Factors: Transporting materials to and from a factory; Companies seek to lower costs o Site Factors: Unique Characteristics of a location o Situation Factors: Proximity to Inputs Involve transporting materials to and from a factory Proximity to Input: optimal plant location is near the input (especially if they weigh a lot) The farther something is transported, the higher the costs, so a manufacturer tries to locate its factory as close as possible to inputs and markets o Raw material transportation costs > transportation costs of product to consumer Bulk-reducing Industry: Because inputs weigh more than the final products, plant location is near market to reduce transportation costs o Weber’s Theory of Industry Alfred Weber (1868-1958) a German economist published Theory of the Location of Industries in 1909. His theory was the industrial equivalent of the Von Thunen Model to outputs Weber’s Theory of Industrial Location: Predicting where a business will or should be located. Inputs relative to outputs Location of an industry is dependent on economic, political, and cultural features as well as whim Weber’s Least Cost Theory: Optimal location Is based on transportation and labor costs Manufacturing plants will locate when costs are the least Agglomeration: many companies form the same industry cluster to draw from a collective set of resources o Examples: Silicon Valley (tech), DC (gov’t), Hollywood (film/entertainment), Hartford (insurance), NYC (finance), Nashville (music), Houston (energy), Orlando (tourism) o Distribution of Minerals Minerals are especially important inputs for many industries. Mineral resources are not evenly distributed across the Earth. Europe and North Africa have relatively few mineral resources o Situation Factors: Proximity to Markets             Proximity to Market: optimal plant location is near the market Raw material transportation costs < transportation costs of product to consumer Critical locational factor for three types of industries: o Bulk-Gaining Industries Production of a product that gains volume or weight during its production. Plants typically located near market to reduce the costs of transportation Examples: Fabrication of parts and machinery from steal and other metals Plants where beverages are bottled o Single-Market Manufacturers Specialized manufacturers with only one or two customers Optimal location for factories is often in close proximity to the customers Examples: Producers of specialized components attached to clothing e.g. buttons, zippers, or pins Markers of parts for motor vehicles Single Market Manufacturers use “just in time delivery” where they receive the parts they need when they need them so there is no warehouse/storage overhead; thus the parts plants need to be near the assembly plant o Perishable Products Companies specializing in perishable products must be located in close enough proximity to their markets that the products does not spoil or become dated during transportation Examples: Food products e.g. bakers and milk bottlers Time Sensitive Products e.g. printed newspapers o Transportation Ship, rail, truck, air Depends on the distance the goods must travel including loading and unloading                 Trucks for short distance, trains for longer, ships for long if water route is available Air is expensive but used for speedy delivery Break-of-bulk points: a location where transfer among transportation modes if possible; increases cost so companies locate near these areas Footloose industries: cost of transportation, raw materials, or finished products is not important to determine location of firm: call centers, claims, billing, Research and development, software, accounting, etc. o Changing Situation Factors in Key Industries Copper: need to be near source with all parts of operation close by including energy source Mining, Concentration, Smelting, Refining Arizona is the largest producing state Steel: More durable than iron; alloy of iron Pittsburgh and South West Pa where coal and iron were; then location swifts to Mesabi Range Area (Great Lakes Region); close to source of raw materials and ability to transport Today minni-mills (use scrap metal) are located close to markets; market location has become more important than raw material location; specialized products Moving to developing countries since 1980s o Auto Industry Fabricated in many parts; assembled in the interior of the country between Michigan and Alabama, “auto alley” to minimize transportation costs Use “just in time” delivery parts Specialized in assembly plants located close to market Bulk Gaining Industry Single Market Manufacturer; clusters near assembly plant Assembly plants located close to markets: North America, China and Europe o Site Factors: Land, Labor, Capital Labor: most important factor at a global scale 10% of US involved Labor intensive industry: one in which wages and other compensation paid to employees constitute a high percentage of expenses Labor costs average 11% in US; average wage $35 per hour in MDCs and benefits; LDCs average $1 per hour (China and India) with very limited benefits  Land:                    Consider energy costs; attractiveness; available resources Transportation networks; space Capital: Borrow funds to establish new factories or expand Business cluster where the money is available; example: high tech in Silicon Valley because of available capital Availability of capital is significant to distribution of industry in LDCs Investment in LDCs depends on political stability, economic policies, debt level Textiles and Apparel Industries Low wage and low skill Employs many women worldwide Spinning is very labor intensive, most done in LDCs near the source of the fiber Weaving is clustered in low wage countries because it constitutes high percent of labor costs and is often done by men Assembly often done in Asia o Low labor costs outweigh cost to transport from these countries Where Does Industry Cause Pollution? o Air Pollution Most generated by factories, power plants, automobiles. Negative effects include: global warming, greenhouse effect, ozone damage. Damage to vegetation and water supply Acid Precipitation (Acid Rain) Smog and particulates in Southern California especially. Increasing in China. o Solid Waste Pollution Paper products are most common type. Come from residences and businesses. Use of landfills, incinerators. Hazardous waste: can get in soil and contaminate groundwater. o Water Pollution Point Source Pollution: enters body of water at specific location Manufacturers and municipal sewer systems. Non Point Sources: come from large diffuse area. Agriculture: fertilizers, pesticides, runoff Lauren Herman AP Human Geo 12/7/2016         Aral Sea in former Soviet Union has dried up and there are salt flats. Water becomes oxygen starved for fish. Why are Situation and Site Factors Changing? o Changes Within Developed Regions Intraregional Shifts Industries moving out of cities because of: o cost of land o no room to expand o availability of transport and technology o proximity to major highways Industrial Parks in suburbs close to highway junctions. o Interregional Shifts In the US manufacturing is moving from New England to South and West. New Infrastructure Cheap labor in the west and favorable state and local government policies. Tennessee Valley Authority electricity Air Conditioning. Right to work laws: factories must maintain an open shop, making it harder for unions to organize. (especially in the South) Oil in the Gulf Coast area and Texas Access to the Panama Canal and western ports Aircraft industry in California because of mild winters Textiles in California and South East because of low labor costs o Interregional Shifts in Western Europe Industry and Manufacturing in Western Europe is moving to economically distressed areas in Southern and Eastern Europe. European Union uses structural funds to encourage development in these areas. Spain has had the fastest growth. o Emerging Industrial Regions Outsourcing New international division of labor: selectively transferring some jobs to LDCs. Low labor costs vs. cost of transportation Turning over much of the responsibility for production to independent suppliers. Now manufacturers can scrutinize each step of the process to determine optimal location.                Have cheap labor costs, especially in garment and textile industry. o Emerging Industrial Regions: Asia China is now the largest steel, textile and household products producer in the world. China has low cost labor and world’s largest market. New government policies allow transnationals to set up, giving more of the population money Special Economic Zones (SEZ): started in China to allow foreign companies to build facilities; special tax and export incentives. Lax and environmental and labor laws Deindustrialization: is occurring in heavy industry in the US (Rustbelt, Baltimore, Midwest) and GB because it is cheaper to manufacture goods overseas. Question: does this sound like communism? o Emerging Industrial Regions: Mexico NAFTA opened up free trade Maquiladoras Plants: factories built by US companies in Mexico near the border to take advantage of cheap labor. Were established in the northern part of Mexico in the 1980s Proximity to US markets still make them popular but they are still too far away for just in time delivery Competition from China and India has caused some to close. o Emerging Industrial Regions: Continued Central Europe has labor and proximity to markets. BRICS: Brazil, Russia, India, China, South Africa. Rapid growing GDP Brazil and Russia have inputs and raw materials India and China have cheap labor South Africa joined in 2010s NICs: Newly Industrialized Countries Former LDCs Increase in infrastructure Rapid population growth Rapid rural to urban migration Examples: Mexico, Brazil, Dominican, Nigeria, Gabon, Indonesia, Vietnam, China, India, Thailand o Core-Periphery Model Wallerstein’s World System Theory Thriving versus Failing Countries Based on economic success        Underdeveloped countries are defined by their dependence on developed core regions. Core: Western Europe and North America Periphery: Eastern Europe, Africa, Asia, South America o Renewed Attraction of Traditional Industrial Regions Proximity to Skilled Labor: Fordist Approach: mass production, repeatedly performing the same task Vertical Integration: where company controls all aspects of production; no longer popular; Globalization has hurt this. Post Fordist Approach: focuses on: teams, problem solving, leveling (all levels of workers being treated alike), productivity. o Large networks of supply chains (auto alley) o Global Industry What is an American Car? Cars are produced by worldwide market places Raw materials Manufacturing of parts Electronics Upholstery Plastics Engines Tires Glass Paint Assembly Labor Sales/Marketing Chapter 12: Services  What is A Service? o Service is an activity that fulfills a human want or need and returns money to those who provide it o Tertiary Economic Sector o Cluster in MDCs because people can afford services Services o Generate more than 2/3 of GDP in most MDCs o Economic Sectors Primary-Agriculture and resource extraction              Secondary-Manufacturing Tertiary-Services Quaternary-intellectual and information Quinary-Branch of Quaternary for highest level of decision making o Types of Services Consumer Services Business Services Public Services Consumer Services o Provide services to individual consumers who desire them and can afford to pay for them Nearly all ½ of all US jobs are in this sector Types of Consumer Services: Retail Education Health and Social Services Leisure and Hospitality Business Services o Facilitate other businesses o Nearly all ¼ of all US jobs o Financial/FIRE (Financial, Insurance, Real Estate) o Professional: Management, Law, Design, Engineering, Accounting, Architecture o Clerical and Custodial o Transportation and Communications: Information, Broadcasting Pilots Public Services o Public Services: provide security and protection for citizens and business o Federal, State, and Local Governments o 10% of all US jobs are in the public sector o This sector is growing Changes in Number of Employees o Rising and Falling Service Employment Service sector of the economy has seen nearly all the growth in employment worldwide Service sector has also been most negatively impacted by the recession o Change in Number of Employees Within business services, jobs expanded the most rapidly in professional services e.g. engineering, management, and law Within consumer services, fastest increase been in provision of health care Where Are Consumer Services Distributed?         o Central Place Theory Explains how consumer services are distributed on a regular pattern based of size of settlements, with larger settlements offering no more consumer serviced but also more specialized ones Proposed by Walter Christaller Central Place is a market center for the exchange of goods and services by people attracted from the surrounding area It’s a centrally located to maximize accessibility Market Area or Hinterlands: area surrounding a service from which customers are attracted Nodal Region To establish a market, a circle is drawn around the node of service on the map; people on the periphery of the circle may choose to get services from other nodes, as well as people on the circumference Requires geometric shape without gaps or overlaps Hexagon is best compromise between circles and squares o Range and Threshold of a Market Area The Market Area of every service varies: geographers need info on the range and threshold of the service Range: maximum distance people are willing to travel to use the service o The Radius of the circle o Sometimes circle is irregular to account for territory for which the proposed site is closer than the competitor’s site People will only travel short distances for daily needs, linger for others People tend to go to the nearest available service Range then becomes the maximum distance that most of the customers are willing to travel o Most people think of distance in terms of times vs. miles; traffic Threshold: minimum number of people needed to support a service o The minimum number of customers to generate enough sales to make a profit Consider the demographic of who your typical customer/client is when determining threshold o Hierarchy of Consumer Services Only consumer services that have small thresholds, short ranges, and small market areas are found in small settlement   Larger settlements provide consumer services that have larger thresholds, ranges, and market areas Developed countries have numerous small settlements with small thresholds and ranges and far fewer large settlements with large thresholds and ranges Hierarchy of Services and Settlements: Producing Patterns Nesting of Services and Settlements: larger market areas are overlaid on smaller market areas Market areas across a developed country would be shaped as a series of hexagons of various sizes, unless interrupted by physical features Consumers can shop in small and large markets Four Different Levels of Market Area: Hamlet, Village, Town, City Seven Sizes of Settlements: Market Hamlet, Township Center, County Seat, Small State Capital, Provincial Head Capital, Regional Capital City Rank Size Distribution of Settlements Ranking settlements from largest to smallest in many developed countries produces a regular pattern or hierarchy Rank Size Rule: the country’s nth-largest settlement is 1/n the population of the largest settlement The second-largest city is one-half the size of the largest, the fourth-largest city is 1/4th the size of the largest and so on When plotted on logarithmic paper the rank-size distribution forms a fairly straight line This happens in the US and a handful of other countries Primate City Rule Largest settlement has more than twice as many people as the second ranking settlement Largest city is the primate city Many LDCs have this Because of this there is not enough wealth in these societies to pay for a full variety of services People must travel great distances for services Mexico is an example Market Area Analysis Determining if locating the market would be profitable and where the best location would be Profitability of Location: use the range and threshold to determine    o   o o   o               Optimal location within a market: one that minimizes the distance to the service for the largest number of people Gravity Model: predicts that optimal location of a service is directly related to the number of people in the area and inversely related to the distance people must travel to access it o More people, more likely to use service o Closer to service, more likely to use it Brick and Mortar (Actual Stores) vs. E-Commerce is changing this theory o Periodic Markets Collection of vendors that cine together on a given day to sell goods and services locally Found in LDCs, MDCs and urban areas Frequency of market depends on culture o Examples: Christmas Markets, Farmers Markets o Central Place Theory Large, contiguous areas of flat land rarely exist There are many forms of transport-cost doesn’t equal distance People and wealth are not evenly distributed People do not always go to the nearest good or service Services and goods are not all equal competitors o Why Do we Use Central Place Theory? Use this idea of equal distribution of services in planning new communities so that all people have access to important high order services and goods Just by looking at the model forces us to compare model vs. reality By exploring the difference we better understand the distribution of goods and services in urban settlements Where are Business Services Distributed? o Business Services Business Services disproportionately cluster in a handful of settlements and individual settlements specialize in particular business services Early urban settlements were well planned (Mesopotamia, Athens, Rome) City-States in Athens had public and consumer services, cultural activities, as well as trading centers “All Roads Lead To Rome”; reflects the communications and transportation network established World Cities revolved around the church and trade; Often cities were walled for defense Many were in Asia          o Business Services Today World Cities dominate business and political power Core-Periphery Model Offer Variety of Business Services Financial Services o Banking o Insurance Corporate Headquarters Stock Exchanges o Investment Banking Services that businesses need to conduct business o Law o Accounting o Advertising Transportation Hubs Lots of wealth is concentrated here leading to more consumer services, including luxury services Public services are many even if it is not a world capital it still has international political power o Ex: NYC o Hierarchy of Business Services World/ Global Cities: New York, London, Tokyo Global headquarters for finance, influence, marketing and advertising Economic, political (not necessarily a capital), cultural, infrastructure factors affect significance Have busy transportation hubs Alpha level designate next level of importance o Global Cities Three Levels Alpha Beta Gamma o Additional levels within each group A combination of economic, political culture, and infrastructure factors are used to identify global cities o Business Services in Developing Countries Offshore Financial Services: Provides tax free status US loses approximately $70 billion in tax revenue each year       Offer secrecy Offer supportive laws, weak regulation, low wage workers Many US companies incorporate in these islands and microstates Caymans deposits total twice the amount deposited in all NYC banks combined o Crime to discuss confidential business in Caymans Back Office Services: Processing claims Payroll Clerical Tech Services Claims Call centers Moved to LDCs because of Cheap Labor In LDCs these jobs hold high status and better motivated and educated people take the jobs Often work late hours to correspond with US times o Economic Base of Settlements Exports needed to bring money into the economy to support non-basic industry Basic Industries: export primarily to consumers outside settlement Important to have because industry brings workers who then demand non-basic industries Thus building the economy Non-Basic Industries: enterprises whose customers live in the same community, essentially consumer services Ex: Pittsburgh has transitioned to Meds and Eds o Specialization of Cities in Different Services Settlements in the US can be classified by their type of basic activity General Business Computing and Data Processing High-Tech industries and support services Military activity support services Management-consulting services Entertainment and recreation Medical services Specializing in Public Services State Capitals Large Universities Military Bases           o Distribution of Talent Special talents are not distributed uniformly among cities Work of Richard Florida shows that people with special talents gravitate to cities with cultural diversity Measure by number of cultural facilities per capita, percentage of gay men, and “coolness index” Talented individuals promote economic innovation “Creative Class” of workers Why Do Services Cluster in Settlements? o Services in Rural Settlements Clustered Rural Settlements: a number of families live in close proximity to each other with fields surrounding the collection of houses and farm buildings. Hamlet and Village Have some consumer and business services Each person is allocated strips of land in surrounding fields. o Minimizes travel time to fields Circular: central open space surrounded by structures Linear: buildings clustered along a road or river to facilitate communication. Long narrow strips of fields French settlements in North America o Clustered Rural Settlements in Colonial America In New England clustered settlements centered on an open area called a common. Reinforce common cultural and religious values, defense against Native Americans Can be still found in New England today. o Dispersed Rural Settlements Mid Atlantic colonies had more heterogeneous groups with different cultural and religious values. Dominated American Midwest because most settlers came from the Mid Atlantic Farmers live in isolated, individual farms Problems with discontinuous fields Need more roads, restricted planting o Services in Early Settlements Early Consumer Services Places to bury the dead                 o Religious leaders stationed at burial sites to perform service of saying prayers for the deceased. Likely encouraged the building of more permanent structures for ceremonies and dwellings. Manufacturing centers: as people need tools, clothing, shelter, etc. o Consumer services expanded when people began to specialize. Early Public Services Primarily tasked with offering protection to everyone in the settlement. o Walls built around settlements for protection. o Defenders (soldiers) Early Business Services Settlement served as a neutral ground where several groups could safely come together to trade goods and services. Early business services focused on food then transportation and trade. Officials in the settlement provided producer services. o Regulating the terms of transactions o Setting fair prices o Keeping records o Creating a currency system o Earliest Urban Settlements Prehistoric Urban Settlements Earliest urban settlements were probably in the Fertile Crescent of Southwest Asia and North Africa. Among the oldest is Ur in Mesopotamia (present-day Iraq) Ancient Urban Settlements Settlements first established in eastern Mediterranean about 2,500 B.C. o Knossos (on the island of Crete) o Troy (in Asia Minor- [Turkey]) o Mycenae (in Greece) Aforementioned urban settlements were primarily trading centers and organized into city-states- independent self-governing communities that included the settlement and nearby countryside. Athens was the largest city-state in Greece Rome was believed to have grown to a population between 250,000 and 1 million. Medieval Urban Settlements   Dense network of small market towns serving the needs of particular lords covered much of Europe. o Largest medieval European settlements served as power centers for the lords, church leaders, and as major market centers. o Tallest and most elaborate structures were usually churches. o Usually surrounded by walls. o Rapid Growth of Urban Settlements Urbanization: the process by which the population of urban settlements grows. Increasing Percentage of People in Urban Settlements Increasing Number of People in Urban Settlements Differences Between Urban and Rural Settlements Large Size High Density Social Heterogeneity