Industry and Manufacturing

1. Industry and Manufacturing Chapter 11 (K.I. 1&2)

2. Industrial Revolution: dramatic innovations in manufacturing, mining, transportation and communication that results in rapid changes in society and commerce 1730s to 1860s First Phase of the Industrial Revolution. Textiles, Iron Production, Steam Power 1860s to 1914 Second Phase of the Industrial Revolution Steel, Chemicals, Railroads, Gasoline Engine, and mass production. Post WWII Third Phase of the Industrial Revolution high technology-computerization, miniaturization and automation

3. Why England? • Geographic Advantages: • Island-not invaded • Resources-coal, iron ore, water power, rivers • Political Advantages: • Stable government-encouraged business • Cultural Advantages: • Entrepreneurs willing to take a risk & inventors. A monopoly of skilled workers

4. Economic Advantages: • Banking system and available capital • The Agricultural Revolution and Enclosure Movement -supply of cheap and abundant labor. • A large merchant fleet was protected by an efficient navy. • Mercantilism-colonies provided sources of raw materials and markets.

5. James Watt’s improved steam made steam power A versatile form of energy for mining, iron production, transportation and even, the milling of flour and brewing of beer.

6. Abraham Darby ‘s coking process, which baked the impurities from coal, gradually replaced scarce charcoal as the fuel for iron production. • Pictured at right are some of the original coking ovens in Northumberland, England.

7. Early 1800s innovations diffused to mainland Europe-Low Countries & Germany Location criteria-proximity to coal fields Connection to a water port Latter Diffusion in late 1800s innovations Location criteria-access to railroads strengthened Paris and London as manufacturing centers Diffusion to Mainland Europe

8. Diffusion of the Industrial Revolution

9. Diffusion to Mainland Europe • A belt of coal fields stretch along southern edge of North European Plain-northern France, Netherlands, German Ruhr, western Bohemia & Silesia • Rotterdam, Netherlands-located on the Rhine-connects Ruhr Valley to the sea-most important port of Europe • Paris-luxury items-jewelry, perfume, fashions plus metallurgy and chemicals-LeHavre major port connects Paris with the sea

10. How do Location Theories explain Industrial Location?

11. Location Theory – predicting where a business will or should be located. Location of an industry is dependent on economic, political, cultural features as well as whim. Location Theory Considers: Variable costs-energy, transportation costs & labor costs Friction of distance-increasing distance =increased time & cost Location Theory

12. Location Models Weber’s Model-The Least Cost Theory Alfred Weber, (1868-1958) a German economists, published Theory of the Location of Industries in 1909. His theory was the industrial equivalent of the Von Thunen Model. Manufacturing plants will locate where costs are the least. Three Categories of Costs: Transportation-the most important cost-usually the best site is where cost to transport raw material and finished product is the lowest Labor-high labor costs reduce profit-location where there is a supply of cheap, non-union labor may offset transportation costs Agglomeration-when a group of industries cluster for mutual benefit-shared services, facilities, etc.-costs can be lower Deglomeration-when excessive agglomeration offsets advantage-eastern crowded cities

13. Hotelling’s Model-Harold Hotelling (1895-1973) this economist modified Weber’s theory by saying the location of an industry cannot be understood without reference to other similar industries-called Locational Interdependence Losch’s Model-August Losch said that manufacturing plants choose locations where they can maximize profit. Theory: Zone of Profitability Location Models

14. Losch’s Model-Zone of Profitability

15. Major Industrial Regions of the World before 1950 • First manufacturing belts were close to raw materials & good transportation • In addition to raw materials other factors: relative location, political situation, economic leadership, labor costs & education and training. • Four primary industrial regions were Western & Central Europe, Eastern North America, Russia & Ukraine and Eastern Asia

16. Open Pit Coal Mine in southern Illinois Coal train moving across Montana is 1½ miles long. It carries barely a day’s fuel for a large power plant. The US burns over 1 billion tons of coal a year-has the world’s richest coal deposits-enough to last 250 years.

18. Eastern Asia-China • Shenyang on the Liao River became the “Chinese Pittsburgh” with machine-making and steel production. • Shanghai & Chang River district is the 2nd largest industrial region of China-rail cars, ships, books, food & chemicals • Enormous labor force, low daily wages, few restrictions have attracted foreign companies to China’s Special Economic Zones (SEZs) Coal=65% of China’s energy & Consumption could double in 20 years

19. Change in Steel Production, 1973–2002 • Steel production has declined in the core and increased in the semiperiphery and periphery, especially in China, India, Brazil and South Korea