1. INDUSTRIALIZATION
APHUG REVIEW

2. History of Industrialization
Existed in some areas pre-18th c (silk factories/China, metal workshops/India)
Work done by hand; powered by water or wind
James Watt’s steam engine more efficiently pumped water to power factories
New methods of smelting iron

3. Industrial Revolution=England
Textile industry: w/ steam engine weaving thread and cloth was quicker=more need for raw materials (wool, linen, cotton)
England had gov support, money from colonies, and COAL; IR spread to other industries in England like transportation and communication
Used steam power for RR and ships
Factories located near resources and population grew around these factories

4. Diffusion of Industrialization
started in coal fields of England
Spread to coal fields of Europe: France, southern Belgium, Netherlands, Germany, Poland ( 19th c)
Used access to skilled labor and transportation routes already established through colonialization
Spread to Spain, Scandinavia, Ukraine (early 20th c)
Diffused to North America (natural resources and land)
Samuel Slater- first textile factory in Rhode Island-1791
Protected by U.S. gov through embargos and high tariffs
Northeastern U.S.
Processing food, lumber, eventually iron and steel (late 19th c)

5. IR after WWI Europe and USA had huge economic advantage
Shift to oil and natural gas as major resource; less reliant on coal
Turned to foreign countries to supply: Canada, Saudi Arabia, Kuwait, Iran, Russia, China, Mexico, Venezuela, Nigeria; many multi-national corporations moved to these places to be near supply; most wealth returned to USA causing tensions (and war) between these countries

9. LOCATION THEORY
Explains the pattern of location of economic activities by identifying factors of influence
Primary industry-near natural resources (Western and Central Europe, Eastern North America, Russia and Ukraine, Eastern Asia)
Secondary industry- not as dependent on location of resources which can be transported to factory
Location of secondary industries depend on:
Variable costs of energy, labor, transportation
Friction of distance=the farther away, the more expensive to transport.
Distance decay-related to friction of distance in regard to distribution; the market is usually located near factory

10. Weber’s Model-Least Cost Theory, explains the location of SECONDARY industries
German economic geographer Alfred Weber
Transportation-raw materials to and finished products away from factory (trucks for short distance, RR for medium, ships for long)
Labor-cheap labor often makes up for more expensive transportation costs (USA to Mexico or Indonesia)
Agglomeration-cluster of similar business-provide support for business in equipment, clothing, customers

11. Situation Factors Optimal location is near customers
BULK-GAINING INDUSTRIES-gains volume or weight during production; needs to be located near where product is sold; examples: canned food, bottled soda, cars
SINGLE-MARKET INDUSTRIES-specialized manufacturing with only one or two customers; example: YKK zipper company in 68 countries near clothing manufacturers; parts suppliers for auto industry
BULK-REDUCING INDUSTRIES- located near raw materials because raw materials are heavier than finished products; example: steel industry in Birmingham, AL near coal and iron
PERISHABLE-PRODUCT COMPANIES-located near customers for rapid delivery before a product spoils; example: bread bakeries and milk bottlers

12. Site Factors-factors related to the cost of production inside the plant
Often MORE important than situation factors!
Labor-most impt site factor on global scale; China ¼ of world’s industrial workers, India 1/5, ALL DEVELOPED countries combined about 1/5
Land-factories originally located in cities near labor source in mult- storied building to save on land costs; today factories are most efficient in one-story buildings where assembly follows a logical order (raw materials delivered at one end and finished product shipped from other); cheaper in suburban areas
Capital-manufacturers typically borrow money to start or expand industry; example: auto industry in Michigan, high tech industry in Silicon Valley (1/4th of all new capital in USA is spent in Silicon Valley!)

13. NAFTA: North American Free Trade Agreement
Mexico, USA, Canada 1994; eliminated most barriers to moving goods
Said to rival European Union in wealthiest and most populous market
PROBLEMS:
Cheaper labor in Mexico
Lower standard of living in Mexico
Labor unions concerned with relocation of American and Canadian industries to Mexico
Lower environmental standards in Mexico
MAQUILADORAS: (a factory in Mexico run by a foreign company and exporting its products to the country of that company)
automobile plants in Mexico near the USA border; nearly all new growth is here, not in USA or Canada; these jobs are now being lost to China because maquiladora jobs ($2/hour) are going to China($1/hour)

14. Maquiladoras Export processing zone (EPZ) or Free Trade Zone (FTZ)
Companies often criticized for violating human rights and damaging environment due to the lack of customs authorities and lax environmental laws; example-NIKE
Example- General Motors
Cities along border: Ciudad Juarez in Chihuahua partnered with El Paso, Texas= 2nd largest bi-national metropolitan area along border
Ciudad Juarez- population 1.3 million “most violent city” outside an actual war zone, 4 international bridges, 300 maquiladoras
Tijuana-San Diego, CA largest bi-national metro border
Large, skilled workforce
550 maquiladoras, which usually pay more than average wage
Tijuana-violent and connected to drug wars

15. China, Special Economic Zones (SEZ)
Same as EPZ’s
Most notable in China is Shenzhen, north of Beijing in Guandong Province
Originally small, rural, coastal town with little technology and resources
1980 China declared SEZ
Pop now 1.9 million and growing; handles 210 million tons of cargo per year
Good communication with Beijing, ocean ports, RR system, international airport
*The entire province of Hainan has been designated SEZ

16. Shenzhen: before and after

17. 4 Asian Tigers Hong Kong, Singapore, South Korea, and Taiwan
Rapid industrial growth in fewer than 30 years
Skipped through steps in Rostow’s stages of growth model
Common characteristics: Seaports, rapidly growing populations, industrialized cities, educated/skilled workforce
Investments from foreign companies-trade with USA and Europe
Manufacture/trade EVERYTHING! Low-quality textiles, toys electronics to high demand products
Hong Kong and Singapore=now financial and information centers

18. 4 Little (Baby) Tigers Malaysia, Vietnam, the Philippines, Indonesia
Striving to be like a big tiger, but haven’t reached that status YET

19. Deindustrialization in USA-when manufacturing plants leave an area on a large scale
Happened over last several decade
Outsourcing of industrial jobs
Relocate factories from American manufacturing regions to manufacturing belts in other countries (SEZ, EPZ, FTZ)
Cheaper labor in other countries
Lenient environmental laws allow for cheaper production
Example: The Rust Belt, includes area around Great Lakes with auto manufacturing plants; after outsourcing plants sit vacant