4Pre-war steel centres Kamaishi (釜石) Kitakyushu (北九州) Muroran (室蘭) located near coalfieldsraw-material orientedcoastal locations
5Post-war agglomeration Osaka-Kobe area (大阪神戶)Tokyo-Yokohama area (東京橫濱)Fukuyama (福山)Nagoya (名古屋)Manufacturing beltmarket-orientedcoastal location
6Reasons for industrial agglomeration change from raw-material oriented to market-orientedpast – near coalfields but now – near marketsattracted by coastal locationsAnd large conurbations due to supply of scrap metal and labourTherefore, they cluster along Manufacturing Belt
7Reasons for indsutrial relocation integrated steel plantsneed a lot of flat land (space-demanding)which is available near coastal areas by reclamation
8Reasons for indsutrial relocation declining supply of local coal and iron oreports enable import of raw materials
9Reasons for indsutrial relocation coastal locations have deep water ports and good port facilitiesbulk carriers can be usedto reduce transport cost
13Reasons for indsutrial relocation large local and overseas marketsfreight rate of products > raw materialstherefore, market-orientation is preferable
14Reasons for indsutrial relocation steel-using industries / industrial linkagesfound in Manufacturing Beltship-building/car industriesEnjoys agglomeration economies
15Reasons for indsutrial relocation large cities can provide scrap metalcan replace pig iron
16Will all factories move to new locations? Why? NoSome firms or particular groups of industries tend to remain in an existing location (non-optimal sites) after the original factors for their location have weakened or disappeared.Sometimes, the locations were more favourable in the past than they are now.This is called industrial inertia.
17Why do the firms stay in original locations? They don’t move because there are still favourable factors of the present location.Can you list some?
18Favourable factors of the present location Physical infrastructure, e.g. roads, water and electricity supplies, are present.Ancillary services are available.A pool of skilled labour is available.The firms need to be near to existing market.The firms need to maintain existing linkages with other firms (with long established business relations)
19Why do the firms stay in original locations? Taking risks to move to new locationsPossible problems encountered in new locationsCan you list some?
20Possible problems encountered in the new locations At the new sites, personal ties and linkages with the original industrial network may break down.At the new locations, the cost and time of training new labour are needed.There are risks and uncertainties in the new production environments. Knowledge about new regions is not so perfect.There are diseconomies of disinvestment, e.g. high cost will be involved in moving bulky capital equipment.
21But what happens to other firms which do not move? 2 possible outcomes:Close down of factories urban decayIndustrial inertia re-industrialization
22How can industrial regions manage to survive? contraction of businessdownsizing the workforceclosure of inefficient plantsrestructuring by adaptation of existing industries in situ, introducing more efficient production methodsdeveloping new industries/new productsmovement towards specialization of products