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The Geography of Manufacturing
Whitney PlaizierShirley Soon
Local and Regional DevelopmentMarch 18, 2009
New Industrial Spaces
New areas of manufacturing concentrations
Beyond those already developed in Europe or North America
Not limited by geographical boundaries or established notions
Examples:Advanced Countries (Italy)Developing Countries (Mexico and China)
Established or NISAdvantages on Building on Established
Areas:Existing pools of skilled laborInfrastructure
Advantages of New Industrial SpacesEasier implementation of new forms of
work organizationNew employment conditionsNew plant configurations
Geographic Unevenness of Manufacturing
Industrialization and investment is geographically selective
Results in highly variable rates of manufacturing growth
Industrialization has been a profoundly regional phenomenon
The Issue of Exports Source of competitive stimulus and tension
between places Industrialization is tied to the terms of trade Geographical concentrations rely upon
interregional and international exports Create tensions between new and old
industrial spaces as exports replace domestic industries
Protectionist policies
Pre/Post Industrial Revolution & The
Third World Pre-Industrial Revolution
Manufacturing production directly correlated with population
3/4 of production located in “Third World Countries” such as China, India and Pakistan
First Wave UK industrializes as leading power (1830-1860) - Third
World declines (60% in 1830) Second Wave
Development of factory system in UK, Europe, US - Third World declines (7.5% in 1913)
Since 1960 Importance has grown (17% in 1990)
Powerhouse Timeline 1750 - China, India, Pakistan 1830-1860 - UK - World’s largest industrial power 1880 - UK peaks 1900 - US > UK with Britain and Germany following 1913 - Established order of US, UK, Germany (total
60.4%) followed by Japan Post WWI and WWII - Russia growing in importance 1953 - US level of 44.7% of world production due
to MNC and FDI development Declining importance of many European countries
including the UK
JapanPost WWII as most dramatic riserWorld’s second largest industrial
powerIndustrial economy comparable to US
and double the size of GermanyMassive increases to jobs (4.1 million)
while UK is drastically cutting jobs (3 million)
Newly Industrialized Countries
Fastest rates of growth outside the OECD Spain, Portugal, Greece, former Yugoslavia,
Mexico, Brazil, Hong Kong, Singapore, Taiwan and South Korea
Four Asian Tigers - domination in the 1990s until the currency crisis
Employment rapidly increasing even though portion of world manufacturing production is minimal
“Shift of manufacturing value added, production and employment to new industrial spaces in the Third World”
Contemporary Global Patterns of Trade
Historic connection between industrialization and trade
Leads to development of geographically concentrated, specialized industrial regions
Increase in manufactured exports from developing countries and NICs to those established industrial countries
Regional Variations - Example Canada
Trade within bordersNatural resourcesService IndustriesVariations in export sales rations
BC and Saskatchewan (24.5% and 27.4% of GPP)
Alberta and Manitoba (19.5% and 13.4% of GPP)
Variations in Imports to Exports
Recent trend towards deficits in terms of trade
More nations leaning towards affordable imports versus supporting more expensive domestic products
Harms domestic employment and profitability
Visible trade versus invisible trade
The Softwood Lumber Issue
Canada versus United StatesEconomically intertwined, especially
with trade25% of US softwood lumber from
CanadaSparked protectionist action on a
regional level in the United StatesDamaging to Canadian producers
Regionalization
American Manufacturing Belt Industrial heartland for the continent Developed transport networks Zones: Consumer goods, producer goods (machinery),
less-specialized goods
Axial Belt in the United Kingdom Industrial strengths coupled with access to the London
market
Ruhr Region Important centre of industry - access to the Rhine River,
European and world markets Foundation for Europe’s coal, iron, steel and heavy
engineering region
De-industrializationMany areas of the American
Manufacturing BeltLoss of manufacturing jobs versus
sustained national averageSpatial shifts towards new areas able
to support new industriesAerospace, electronics and chemicals
The Economics The richest, powerful = most industrialized
(OECD nations) Per capita and income gross domestic
product increases Three-sector “stage” model
Primary, secondary, tertiary industries dominate the economy at different times
But they all lead to the next stage together Manufacturing and industry are still important
as a knowledge based society takes hold Job opportunities!
The Job IssueManufacturing capabilities have
outstripped the need for as many workers
Creation of jobs will be a difficult task for future
Government commitment and involvement
Smith versus List Economic Liberalism
Division of labor and pursuit of self-interest Fair competition Minimal government involvement Economic freedoms - trade, investment, labor
movement Economic Nationalism
Development of “productive forces” Interrelationships between industry, agriculture,
commerce, and transport Tied to improvements in heath, education, religion
and family life - therefore a government intervention
Liberalism verus Nationalism
Decide industrial development Technology transfer, capital goods development,
skill formation, inter-firm relations
Liberalism Support FDI
Nationalism Cautious towards FDI Legislation and bureaucracy
Canada and Sweden Canada
Encourages competition and FDI for increased knowledge consumption
Cheaper than developing independently
Sweden Development of domestic industries Heavy research and development utilized around
the world Dated technology for employees to develop on
TodayNICs incredibly important in export-
oriented activitiesCountries unable to change status
levels since the 1930s Periphery, semi-periphery, core country
status
UrbanizationGreat ties to industrializationManufacturing anchored by
metropolitan cities with high growth Development of inner-city suburbs
supporting manufacturing employmentNon-metropolitan industrialization
trend