Chapter 11: Industry Vocabulary Def & Examples & Why? / Significance

25. Outsourcing

*Identify*: A decision by a corporation to turn over much of the responsibility for production to independent suppliers. *Example & Why*: MDC companies hire independent call centers in India for their affordable prices.

3. Break of bulk (point)

*Identify*: A location where transfer is possible from one mode of transportation to another. *Example & Why*: An airport could be a break-of-bulk point between air and land transportation.

21. location theory

*Identify*: A logical attempt to explain the locational pattern of an economic activity and the manner in which its producing area are interrelated. - Firms choose locations that maximize their profits and individuals choose locations that maximize their utility. *Significance*: The summation of the works of Alfred Weber, Von Thunen, and others, concerning the location of economic activity.

16. Industrial revolution

*Identify*: A period from the 18th to the 20th century where major changes in agriculture, manufacturing, mining, transportation, and technology had a profound effect on the socioeconomic and cultural conditions of the times. Its hearth was Great Britain, but it quickly diffused to Western Europe, and, by proxy, its colonies. *Significance*: A series of improvements in industrial technology that transformed the process of manufacturing goods.

22. manufacturing region

*Identify*: A region in which manufacturing activities have clustered together. *Example & Why*: Rust Belt in the US, which is currently debilitated because many manufacturing firms have relocated.

20. Weber's least-cost Theory

*Identify*: A theory of industrial location in which an industry is located where it can minimize its costs, and therefore maximize its profits. *Significance*: Accounted for the location of a manufacturing plant in terms of the owner's desire to minimize THREE categories of cost: transportation, labor and agglomeration.

2. Assembly line

*Identify*: An efficient manufacturing process in which components are added to a product in a sequential manner using optimally planned logistics and the arrangement of workers/machines/equipment, resulting in extremely fast production. *Example & Why*: Everything sold at Wal-Mart was mass-produced at an ____________ ____________.

19. Labor-intensive

*Identify*: An industry for which labor costs comprise a high percentage of total expenses. *Example & Why*: The textile industry needs to hire numerous dexterous workers in order to operate spinning machines.

6. Bulk reducing industry

*Identify*: An industry in which the final product weighs less or comprises a lower volume than the inputs. *Example & Why*: Automobile manufacturing--it takes various small components and combines them to form a large product.

5. Bulk gaining industry

*Identify*: An industry in which the final product weighs more or comprises a greater volume than the inputs. *Example & Why*: Soft drink bottling--from empty bottles to full bottles, there is an obvious weight gain.

12. footloose industry

*Identify*: An industry that can be located anywhere without any ramifications. *Example & Why*: Although software companies may not technically fit in the category of heavy industry, they do constitute a ____________ ____________, as nothing truly has to be shipped.

14. growth pole

*Identify*: An urban center with certain attributes that, if augmented by a measure of investment support, will stimulate regional economic development in its hinterland *Example & Why*: The concentration of high-technology businesses in the Silicon Valley

11. Export processing zone

*Identify*: Established by many countries in the periphery and semi-periphery where they offer favorable tax, regulatory, and trade arrangements to attract business and investment *Significance*: Labor is cheaper and environmental restrictions are relatively weak in these zones. Also known as EPZ.

4. Brownfield

*Identify*: Industrial land abandoned or underused due to real or perceived environmental contamination, hazardous waste and/or pollutant. *Example & Why*: The Rocky Flats nuclear plant became THIS after the Cold War.

28. Site characteristics

*Identify*: Location factors related to the cost of factors of production inside the plant. (Land, Labor, Capital) *Example & Why*: Maquiladoras illustrate an excellent compromise of all three site factors.

29. Situation characteristics

*Identify*: Location factors related to the transportation of materials into and from a factory, and methods (ship, rail, truck, or air). *Example & Why*: Bulk-reducing industries locate close to inputs; bulk-gaining industries locate close to markets.

9. Cottage industry

*Identify*: Manufacturing based in homes rather than in a factory, commonly found before the Industrial Revolution. *Example & Why*: A modern-day ____________ ____________ could be Etsy.com, a website allowing anyone to purvey their handmade goods.

10. Deindustrialization

*Identify*: Process where the companies move industrial jobs to other regions (typically with cheaper labor), leaving the newly deindustrialized region to switch to a service economy and work through a period of high unemployment. *Example & Why*: The US "Rustbelt"; Northeastern China. The was a decline in industrial activity in a region or economy and an increase in the service sector

31. special economic zone

*Identify*: Specific area within a country in which tax and investment incentives are implemented to attract foreign (and domestic) businesses and investment. *Example & Why*: Maquiladoras are _______ _______ ______ on Mexico's northern border with the United States.

17. infrastructure

*Identify*: The basic services and facilities needed for an area's economy to function *Example & Why*: India's lack of reliable ____________ has slowed its still meteoric economic growth.

1. Agglomeration industries

*Identify*: The clustering of productive activities (or industries) and businesses (or people) for mutual advantage (benefits). *Example & Why*: The concept of ____________ is applied in malls across America and the world over. When retailers specializing in a specific article of clothing locate near each other, people will usually shop at each business to create an outfit as opposed to only visiting one. Having numerous retailers located in a single area draws customers interested in a number of products, and individual customers are likely to spend money not only at their initial destination but also in surrounding businesses (Further notes @ https://apmodels.wikispaces.com/Industry+and+Economic+Development)

18. economies of scale

*Identify*: The cost advantages that a business gains due to expansion. *Example & Why*: Larger industries need to purchase more raw materials. Generally, the more that is purchased, the lower the unit price gets. Hence, expansion is beneficial for industry. See warehouse club stores like Costco and their price reductions...

30. secondary industry

*Identify*: The industries of the secondary sector of the economy. **Secondary sector = Manufacturing (Transforming/assembling raw materials) *Example & Why*: Petroleum refining belongs to this category.

26. primary industry

*Identify*: The industries taking place in the primary sector of the economy. **Primary sector = Direct raw materials *Example & Why*: Oil extraction is identified as this type of industry.

24. mass production

*Identify*: The large-scale production of standardized products. *Example & Why*: Most automobiles are ____________-____________.

15. industrial inertia

*Identify*: The refusal of a company to leave its original location even when the reasons that made the location suitable or advantageous have disappeared. *Example & Why*: To some degree, the factories in America's "Rust Belt" are running on __________ _________, as Mexican auto manufacturing has proven lucrative.

23. market orientation

*Identify*: The tendency of an economic activity to locate close to its market; a reflection of large and variable distribution costs *Example & Why*: Bulk Gaining Industry are very ______________ ___________ed because the cost of shipping outputs to market exceeds the cost of shipping inputs to the factory.

27. raw material orientation

*Identify*: The tendency of an economic activity to locate near or at its source of raw material; this is experienced when material costs are highly variable spatially and/or represent a significant share of total costs *Example & Why*: Bulk Reducing Industry are very _________ ___________ ____________ed because the cost of shipping inputs to factory exceeds the cost of shipping outputs to market.

7. Capital (in terms of money or property)

*Identify*: Wealth [aka monetary assets] owned or employed in business by an individual, firm, or corporation. *Example & Why*: Technology startups, especially in California's Silicon Valley, often need to convince prominent venture capitalists in order to gain essential ____________ for their business.

8. Complementarity

*Identify*: When two regions, through trade, can specifically satisfy each other's demands. *Significance*: Trade is often the exchange of raw materials and/or finished products. Usually referring to economic interactions, this can be the actual or potential relationship between two places/

13a. Fordism 13b. Post-Fordism

*a*. A form (system) of mass production where each worker is assigned one specific task to perform repeatedly, in order to increase production efficiency for mass production using assembly lines. *-*A former method for improving the productivity of the automotive industry, which can now be applied to any kind of manufacturing process. Comes from Henry Ford's idea of an assembly line company. *b*. Adoption by companies of flexible work rules, such as the allocation of workers to teams that perform a variety of tasks. *-*Some scholars describe this as the dominant system of economic production, consumption and associated socio-economic phenomena, in most MCDs since the late 1900s.