GEOG 272 ECONOMIC GEOGRAPHY

The course's aims

This course introduces you to the principal concepts and methods in economic geography. Economic geography is the study of the spatial dimensions of how people earn their money, how firms create jobs and wealth, and how the economy interacts with the physical environment. The course focuses on how the geographical aspects of agriculture, manufacturing and the service-sector have been created, and it explains why the location of productive activity has varied in the past, and will change in the future. The course examines economic activity at scales ranging from the local to the global and the course concentrates on the period since 1945 and on the developed world. Additionally the course aims to help you analyse information, synthesise arguments, judge the validity of hypotheses and develop further your writing skills.

The course's outcomes

At the end of this course you will be:

Syllabus

The course comprises ten blocks of study.

Block 1 Approaches to economic geography
Block 2 Agriculture
Block 3 The food sector
Block 4 Manufacturing - location theories
Block 5 Globalisation and transnational corporations
Block 6 New industrial systems
Block 7 Business services sector
Block 8 Leisure and tourism sectors
Block 9 Gender and economic geography
Block 10 Regional and local economic development policies

Model examination answers

There are also some model examination answers at the end of this Web document.

Key textbooks

There are a few textbooks, with multiple copies in Short Loan, any one of which you might like to buy for this course. They are listed here with their Lancaster University Library classmarks.

P. Knox and J. Agnew The geography of the world economy (3rd edn) Arnold (1998) DU

P. Dicken Global shift (3rd edn) Chapman (1998) TD3

M. Healey and B. Ilbery Location and change OUP (1990) DU

R. Hayter The dynamics of industrial location Wiley (1997) TDF

P. Daniels and W. Lever (eds) The global economy in transition Addison Wesley Longman (1996) TW

P. Lloyd and P. Dicken Location in space (3rd edn) Harper Collins (1990) DU

J. Wheeler et al. Economic geography (3rd edn) Wiley (1998) DU

It is essential that you do the reading suggested for this course. The text in each block is only a general guide to the structure of the topic. Elaboration of ideas, examples and statistical material will be found in the references.

Interesting WWW sites

In most of the blocks there is a section called "Interesting WWW sites". The aims of this section are to guide you to sites on the WWW which will let you:

The WWW sites are given as hypertext links (i.e. clickable direct links) from this document to the remote site, but since WWW addresses change frequently, some of the links may no longer be operational. If you discover that this is the case, please let Dr Gordon Clark know so that amendments can be made.

Study topics

At the end of the text in each block there are some study topics to look out for during your reading. They should help you consolidate and structure your reading and thinking about the topic.

Tutorial support

Dr Gordon Clark is happy to answer questions about the course.

Assessment

The course is assessed by an examination and an essay, each providing 50 per cent of the final mark for the course.

The examination will be held in Summer Term. It will comprise a 1.5 hour unseen examination paper with two sections, one with three questions on population geography and the other with three questions on economic geography. You will be required to answer two questions, one from each section.

A good examination answer is one which has the following features:

It is often useful to do 'practice answers' to the questions on previous examination papers.

The essay should be chosen from the list of population and economic geography titles given below. It should be 2500 words long; include a word-count for your essay to show that it is not over-length; seriously over-length essays may be penalised. The deadline for submitting the essay to the essay box in Room B65 is 5 p.m. on Monday 14 December 1998. Only the Director of Part 2 Studies can give an extension for essay deadlines. The essay should be word processed or typed.

A good essay is one which has the following features:

Essay titles for Economic Geography

1 With reference to either food chains or manufacturing, explain the trend to globalisation. Who will benefit from such globalisation? (See the references to Blocks 3, 5 and 6).

2 'If manufacturing firms want cheap labour, they should all now move to China'. Explain why they have not. (See the references to Blocks 4, 5 and 6).

3 "The growth in demand for tourism and leisure activities will be the salvation of rural economies across the developed world". To what extent do you agree with this claim? Justify your answer. (See the references to Block 8).

4 Describe and explain the spatial variations in women's involvement in the formal economy. (See the references to Block 9).

5 How and why have governments tended to subsidise farmers and with what effects? (See the references to Block 2).

6 Will the development of telecommunications and the Internet remove the need for cities which are major financial centres and for the financial districts within such cities? Justify your answer. (See the references to Blocks 5, 6 and 7).

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BLOCK 1 APPROACHES TO ECONOMIC GEOGRAPHY

Economic geography (EG) is about the production of goods and services and their consumption. EG is concerned with where these activities take place; how they are organised over space; how areas and their populations are affected by their types of production and consumption; why areas specialise in certain activities; and how space is used by firms to their benefit.

The way economic geography is approached as a field of study has changed over the last 30 years. Formerly the emphasis was on the links between production and resources, on the costs of production in different places and on how individual small firms operated. More recently the emphasis has switched to the operation of large (global) firms, the links between economic activity and capital, the social effects of employment changes and their environmental effects. Continuing themes have been how governments can try to increase employment in areas of high unemployment or out-migration, and the effects of new technologies, transport systems and ways of organising production on where it takes place.

These changes in how EG is studied parallel the major changes in peoples' standards of living and their working lives - shorter for many men, longer for many women, more complex, organised in different ways, and huge changes in agriculture, tourism and the kinds of manufacturing.

The three key actors in EG can be identified: (i) firms (i.e. profit-seeking individuals and companies); (ii) governments (from the local to the supranational); and (iii) financial institutions. Each tries to influence the other two and in turn is influenced by them. The ability, and in part the enthusiasm of governments to play a part in this triangle has fluctuated while the other two actors have arguably become more powerful. A possible fourth actor (the labour force) has seriously lost influence over the last 30 years.

The trend recently has been for EG to become more interested in the processes of change instead of just describing what is produced where. A concern for process has shifted the emphasis to explaining why economic activity is where it is and why some of it is relocating. Some of these process concerns are fairly short-term (the changes in a sector over 10 or 20 years of restructuring, for example) and some are long term (examining the changes over the last century e.g. the ideas of Kondratieff and Kuznets). Some of the concerns are small-scale (how Lancaster's economy has been changing, for example) and some are global in their reach.

The most traditional approach which economic geographers have used is to explain the location of economic activity is to consider each activity as needing a combination of the four 'factors of production' - land (and buildings), labour, capital and entrepreneurship. Each activity needs a different combination of these (e.g. farming needs lots of land, oil refining needs lots of capital). The quality and price of these factors varies spatially (labour is cheaper in the countryside than in major conurbations) and they vary in price and quality historically (energy is now cheaper whereas labour is often more expensive than previously). Sometimes the higher cost of a factor can be offset by its greater quality or productivity (German workers are better trained and have the investment to let them be more productive even though they are more expensive to hire). Some of these factors can be moved from where they are plentiful and cheap to where they are scarce and expensive (raw materials and electricity can be transported, and people can migrate) but many transfers are still slow or expensive. Immigration laws, banking controls and housing markets often form barriers to the full movement of factors, hence their price differentials persist.

Firms can also change the balance of resources they need. Factories are getting bigger (one storey, more parking), raw materials are used more intensively, labour can be reduced by automation. These changes in factor demand affect different sectors in different proportions. Manufacturing has extensively dispensed with labour whereas hotels have not been able to. So a major force for locational shifts has been the changing availability, cost and quality of the resources available to firms, and firms' consequent changes in the resource balance they need and their re-direction of investment to new areas that now meet their needs better.

The references give plenty of examples of these trends.

Study topics

1) Look for examples of factors of production becoming more or less expensive and of firms altering the balance of resources they use.

2) Find examples of firms altering their location (or choosing new locations) because certain key factors for them are cheaper or more productive in one place rather than in others.

3) How does Kondratieff explain long-run changes in industrial location?

References

P. Knox and J. Agnew The geography of the world economy (3rd edn) Arnold (1998) DU chaps 1-3.
P. Dicken Global shift (3rd edn) Chapman (1998) TD3 chaps 1-2.
M. Healey and B. Ilbery Location and change OUP (1990) DU chaps 1-4.
R. Hayter The dynamics of industrial location Wiley (1997) TDF chap 1.
P. Lloyd and P. Dicken Location in space (3rd edn) Harper Collins (1990) DU chaps 1, 4 and 6.
J. Wheeler et al. Economic geography (3rd edn) Wiley (1998) DU chaps 1-3.

The Library's home page with links to other libraries.
The Library's computer catalogue.
The BBC news site for current affairs.
The International Labour Organisation in Geneva.
The Institute for Fiscal Studies has some useful research articles.
OECD's national economic statistics.
The World Bank's site.
A general collection of economic geography WWW sites.
Another general collection of economic geography WWW sites.

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BLOCK 2 AGRICULTURE

Agriculture is the oldest economic activity and is distinctive because of its need for land, its low monetary value of output, family structure, and shrinkage in employment in the last 50 years particularly. For farmers their key question is 'what shall I produce here on this farm?' (since they tend to be locationally fixed as farmers) rather than the industrialists' question of 'where shall I produce this item?

The triangle of key actors in agriculture is: (i) the farmers (studies that focus on them tend to be 'behavioural'); (ii) governments (studies of their activities tend to be 'regulationist'); and (iii) the rest of the agricultural and food sector (studies here tend to be 'structuralist' or 'neo-classical').

Studies of farmers tend to focus on areas such as these:

* the influence of the physical environment, limiting what can be produced. This approach can be criticised as 'deterministic' and outdated by the huge technical advances in farming. Yet the most fertile areas are still the cheapest in which to produce food (no technology needs to be bought). Falls in the farmgate price of foodstuffs are likely to lead to production 'retreating' to core areas of naturally high productivity.

* the desire of farmers to grow what is most profitable. This is limited in practice by their difficulty in forecasting prices at harvest, and their being locked into earlier production patterns by their location, environment, equipment or training.

Such 'behavioural' approaches can be accused of 'voluntarism', that is ignoring the constraints placed on farmers by their general setting and placing too much stress on their free will.

Studies of the role of the state (governments) in agriculture tend to focus on the following:

Why should the state intervene in agriculture? Some of their goals are equity issues (reducing rural poverty, maintaining rural population structures, stabilising the countryside). Others are utility goals such as stabilising food prices, reducing food imports, helping the balance of payments, or protecting the environment. Over time some of the dominant goals have changed in many countries (self-sufficiency is less of a goal now, protecting the environment is more important). There has also been a trend away from price support and towards animal welfare, safety and environmental controls on farmers.

What are the effects of state intervention? It is hard to measure the effects of a subsidy or regulation, let alone the efficiency with which the money was spent on it. Side-effects from state intervention have been noted in terms of price subsidies raising the price of farm land and helping most the largest farmers and landowners who need income support the least on welfare grounds. Generally, state intervention has slowed but not reversed the free-market contraction and consolidation of farming.

There is also the question of whether the state intervenes on behalf of a core group (e.g. landowners, big farmers, food exporters; an 'elitist' strategy); or the state tries to be a neutral arbiter between the many interested parties (a 'pluralist' strategy); or it has its own agenda (e.g. free trade or cheap food; an 'instrumentalist' strategy).

The structure of agriculture within which farmers have to work is also changing quickly. There has been a rapid concentration of buying power at the farmgate by major food processors, wholesalers, exporters and retailers; this leaves the farmers at a major disadvantage. The rapidity of changes in dietary preferences leaves farmers hard pressed to catch up (e.g. vegetarianism, organic food, low-fat foods). The growth of competition between producers in different regions (even different continents) and in different sectors drives down prices further ('substitutionism'). Of the income they do earn an increasing proportion gets spent on outside suppliers as diverse as tractor sellers, fertiliser companies, accountants and agronomists (the 'appropriating' of farmers' incomes).

All in all, the farmers' lot is not a happy one these days. They try to cope in the traditional ways for farmers by: (i) making do with less income (but the next generation may be put off coming into farming); (ii) expanding operations and taking over other farms (less income per hectare but more hectares); (iii) cutting costs (which may impoverish the rest of the rural community); or (iv) going for niche markets for distinctive or quality foods (higher margins and less mainstream competition).

Study topics

1) If most governments subsidise farm production, how might this affect where food is produced?

2) What circumstances led to food from the Americas being competitive in European markets in the second half of the 19th century? To what extent were these conditions found in Europe in the 1970s and today?

3) Can you find any examples of farmers survival strategies in the 1990s? How effective are they?

References

P. Knox and J. Agnew The geography of the world economy (3rd edn) Arnold (1998) DU chap 9.
M. Healey and B. Ilbery Location and change OUP (1990) DU chaps 3, 8, 9 and 10.
P. Lloyd and P. Dicken Location in space (3rd edn) Harper Collins (1990) DU chaps 1 and 2.
J. Wheeler et al. Economic geography (3rd edn) Wiley (1998) DU chaps 13 and 14.
B. Hill and D. Ray Economics for agriculture Macmillan (1987) UAEea chap 6.
B. Ilbery Agricultural geography OUP (1985) UAD chap 2.

The Ministry of Agriculture for the UK; current affairs and statistical information.
Cargill is a major multinational food trading company.

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BLOCK 3 THE FOOD SECTOR

The economic activity that feeds nations starts at the farm but now has many steps beyond that before food reaches its final consumer - the metaphor of a food chain is used. Around 20 per cent on average of the final price of food goes to the farmers; the rest is shared by processors, wholesalers and retailers and the catering trade. So, substantial changes in farmgate prices (even if passed on) will have relatively little effect on final shop prices. In part the food chain involves simple processing for health reasons (e.g. milk pasteurisation) or to prolong the 'life' of food (e.g. freezing or canning vegetables) or consumer convenience (washing and packing potatoes). In other cases the aim is to add value to the product so as to gain a higher price for it (e.g. ready-made meals).

The origin of fresh products can usually be located and it may have to be labelled as to type and source (e.g. variety of apple and its country of origin). Ingredients in processed foods are usually geographically anonymous. For these markets, supply is by price which puts further pressure on farmers' incomes.

There has also been a major trend to the internationalisation of diet - burgers, curry, and pizza compete with local traditional dishes and ingredients. This trend is driven by the rise in foreign holidays and fuelled by rival supermarkets seeking to retain customers' loyalty by providing a stream of new products. The growth in eating out has fuelled this, especially in restaurants featuring the cuisine of formerly immigrant groups.

The rise of food technology has allowed foods to be used in novel ways. So, potatoes can be specially bred to form a starchy feedstock for single-cell protein cultures which can be grown and them spun into artificial 'meat'. One can also increasingly substitute foodstuffs (e.g. maize can provide isoglucose which is a competitor for sugar cane and beet in the market for sweeteners).

The globalisation of the food chain is another key feature of the food sector. Not only are even basic foodstuffs being cheaply transported in- and out-of-season across the globe, but international competition to supply foods is reducing the local monopoly farmers once had. International food processors sell increasingly supranational products to national and international retailers (4-6 of whom dominate grocery sales in many countries). Global brands, global tastes and buying preferences, and global advertising are needed to ensure these huge economies of scale in food supply.

How can individual farmers cope with this? They could try and produce a niche product of a distinctive type or superior quality which will sell for more and be a high preference purchase for some customers. They could try to use EU quality designations to protect their distinctive products from imitations made anywhere. They could enter small specialist markets (e.g. organic foods or goat products). They could sell products through small local retailers or specialist shops. However, setting up alternative food chains is slow and can be precarious.

Study topics

1) What are the effects on global trade of major food processing and retailing companies?

2) How are global food brands created and sustained, and what has their effect been on diets and farming?

3) What role do health and environmental factors play in farming activity?

References

P. Knox and J. Agnew The geography of the world economy (3rd edn) Arnold (1998) DU chap 9.
M. Healey and B. Ilbery Location and change OUP (1990) DU
P. Lloyd and P. Dicken Location in space (3rd edn) Harper Collins (1990) DU chaps 3, 7 and 8.
J. Wheeler et al. Economic geography (3rd edn) Wiley (1998) DU chap 14.
R. Le Heron Globalized agriculture: political choice. Pergamon (1993) UAEZ
B. Hill and D. Ray Economics for agriculture. Macmillan (1987) UAEea

The Vegetarian Society.
The SAFE food alliance; an alternative view of food issues.

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BLOCK 4 MANUFACTURING: LOCATION THEORIES

For manufacturers the question is usually 'where shall we make this item?' A number of theories have been proposed to answer this question. The earliest were based on neo-classical economics, more recent ones on behavioural theory and the theory of the firm, and finally a set of approaches based on political economy and organisation theory.

While manufacturing is roughly distributed as is the national population, in most countries there are areas which are more than averagely dependent on manufacturing and often on only certain products. Location is one factor (but only one) in the profitability of firms and hence in their survival. A review of current affairs will show you examples of the dynamic elements of industrial location - sectors in decline and others growing. The general decline in the number of people employed in manufacturing makes the location of those left all the more critical to the fortunes of economies.

One set of theories said that things are manufactured where it is cheapest to make them (e.g. that of Weber). Where that place is, depends on the stage of the product in its lifecycle (Vernon). New products require a lot of technical input and are often made in advanced economies near major research laboratories. Well established products being made in large quantities need a lot of labour and so may be made in low-wage economies. The cost structure of the firm may also affect where is cheapest. A firm needing a lot of one resource (e.g. labour, capital or electricity) may be attracted to an area where that resource is cheaper; or they may change their manufacturing methods so that they use much less of the resource (e.g. automate where wages are high). The 'correct' location for a firm can be displaced to areas which are artificially cheaper due to lower taxes on firms, bribery or regional grants.

The cheapest location may also vary historically. First, relative costs may change (e.g. a low-wage economy may become a high-wage one, or a cheap raw-material source may become expensive as the resource runs out). If a cheap location becomes an expensive one after a factory has been set up, the factory will usually continue to operate sub-optimally until the original investment has been paid off, and then relocation becomes a possibility. Consultancy firms exist to help major investors find the cheapest long-run location anywhere in the world.

A subset of the cost-based theories is the view of Marshall (ca. 1910) that there are cost savings to be had by firms, especially smaller ones, clustering together in 'industrial districts' to share the general benefits for all manufacturers of 'urbanisation economies' and specific 'agglomeration economies' where the firms are all making the same sort of product. Marshall went further and suggested that there might also be other hard-to-measure benefits from being in an area dedicated to manufacturing in terms of entrepreneurial skill and everyone being well-disposed to manufacturing endeavour.

A second group of theories (e.g. Lösch) stressed how the location of manufacturing could affect sales (rather than costs of production). This might be by locating in the centre of a major market so as to gain, first, a bigger market share and second, greater production and so larger economies of scale. This becomes less important where transport costs are low enough to allow even distant manufactures to compete with local firms. Location of production may also affect sales where the firm makes items according to a local style or needs to keep up with fast-changing fashions, or where an area has a reputation for good quality products.

A third set of approaches adopts a behavioural approach which is allied to the theory of the firm in economics. This approach stresses the elements of partial knowledge, poor forecasting and the desire to minimise risk which affects all managers as people. The problem for most managers is that selecting a location is a rare event in their working lives and so they find it hard to learn from experience. Collecting information is slow and expensive and decisions on location often have to be made quickly to seize market opportunities. So Pred's behavioural matrix and Alchian's work on learning and adaptation strategies may help explain the sub-optimal aspects of many location decisions. Simon's work on managers' motivations (which may not focus on maximising profits) and their characterisation as 'boundedly rational satisficers' also explains why location decisions are rarely wholly rational.

The trouble with the behavioural approach in manufacturing studies (even more than in farming) is that many key decisions are now made by very large firms operating at many sites in several countries. Their decisions are made through complex committee structures rather than by fallible individual managers. The organisational culture of very large firms varies considerably, some being highly centralised and others more dispersed, and this will affect how they view particular countries as location sites. These firms have the resources to collect a lot of data and try to make sense of it, but they are also prey to new uncertainties concerned with political vagaries and exchange rate fluctuations which affect small firms less markedly.

Study topics

1) Look for examples of the effects on manufacturing firms of the co-existence of areas with very high and very low wages. How do different firms cope with/exploit these spatial wage differentials?

2) Are there any firms today that locate their place of production so as to maximise their sales?

3) Does the Marshallian idea of industrial districts have any value today?

4) How do local and national governments seek to exploit the time constraints, fear of risk and limited information of firms, in an attempt to attract them to particular localities?

References

P. Knox and J. Agnew The geography of the world economy (3rd edn) Arnold (1998) DU chap 5.
P. Dicken Global shift (3rd edn) Chapman (1998) TD3 chaps 2-4.
M. Healey and B. Ilbery Location and change OUP (1990) DU chaps 5-7 and 12.
R. Hayter The dynamics of industrial location Wiley (1997) TDF chaps 4-6.
P. Daniels and W. Lever (eds) The global economy in transition Addison Wesley Longman (1996) TW chaps 7, 10 and 14.
P. Lloyd and P. Dicken Location in space (3rd edn) Harper Collins (1990) DU chaps 1-5.
J. Wheeler et al. Economic geography (3rd edn) Wiley (1998) DU chaps 6, 10 and 11.
K. Chapman and D. Walker Industrial location (2nd edn) Blackwell (1991) TDF.

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BLOCK 5 GLOBALISATION AND TRANSNATIONAL CORPORATIONS

First within manufacturing and then in services, the recent trend has been to develop very large firms which operate multinationally or transnationally (MNCs). They not only trade between many countries, they produce goods or services in various countries. Such firms are large and account for an increasing proportion of world trade and, to much lesser extent, employment. Their increasing presence is a global phenomenon.

Most MNCs are based and originate in a handful of core countries (e.g. USA, UK, Germany, etc.). They grow either by 'organic' growth (making more and more items) or by merger and takeover of other firms. There are various models of the routes to large multinational size based on the changing balance of advantage for a firm between exporting goods from one factory or producing goods in different places at various stages of their 'lifecycle'.

The growth of MNCs has been greatly helped by international agreements to reduce significantly tariff and some non-tariff barriers to international trade. The transport sector has innovated to cheapen the costs of even intercontinental trade. The key advantages from becoming an MNC lie in issues of ownership, location and cost savings, and the internalisation of costs.

The textbooks illustrate these changes with specific reference to US and Japanese firms and their patterns of Foreign Direct Investment over the last 50 years. The case studies illustrate the way MNCs are concentrated in certain new and rapidly expanding sectors, and how they favour particular types of location.

The effect of having a high proportion of the local or national economy controlled by foreign firms has been a very controversial area and the textbooks deal with issues such as the loss of political control, transfers of better practice to local firms, multipliers, occupational structures, the volatility of employment and balance of payments effects.

Study topics

1) Why do firms become multinational?

2) Why do all firms not relocate to the cheapest labour location?

References

P. Knox and J. Agnew The geography of the world economy (3rd edn) Arnold (1998) DU chaps 6-8.
P. Dicken Global shift (3rd edn) Chapman (1998) TD3 chaps 5-10.
M. Healey and B. Ilbery Location and change OUP (1990) DU chaps 7, 12 and 14.
R. Hayter The dynamics of industrial location Wiley (1997) TDF chaps 8 and 11.
P. Daniels and W. Lever (eds) The global economy in transition Addison Wesley Longman (1996) TW chaps 3, 4 and 14.
P. Lloyd and P. Dicken Location in space (3rd edn) Harper Collins (1990) DU chaps 7-9.
J. Wheeler et al. Economic geography (3rd edn) Wiley (1998) DU chaps 3, 4 and 11.
M. Freeman Atlas of the world economy Routledge (1991) DU.
B. Malmberg Problems of time-space coordination: a key to the understanding of multi-plant firms. Progress in Human Geography 19 (1995) 47-60 DG6.
P. Dicken et al. Putting Japanese investment in Europe in its place. Area 29 (1997) 200-212. DG6.
J. Allan and G. Thompson Think global, then think again - economic globalisation in context. Area 29 (1997) 213-227. DG6.

Worth trying to find the WWW site of any major multinational firm to see how it is organised spatially. Examples include:
Siemens; very large German electrical engineering multinational.
Royal Dutch Shell.
McDonalds.
British Petroleum.
Nokia; Finnish mobile telephone company.
Alstom; British-French train builders and electrical engineers.
British Aerospace.

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BLOCK 6 NEW INDUSTRIAL SYSTEMS

Besides the growth of multinational firms (and related to this) have been various other changes in how manufacturing in particular is organised. The key ideas here are: (i) new spatial divisions of labour; (ii) Fordist and post-Fordist production systems; (iii) flexible production.

New spatial divisions of labour means the effects of many firms deciding independently but in parallel to concentrate certain functions in certain areas. So, for example, the 'fragmenting' firm might decide that each of its functions (e.g. headquarters, research, production and distribution) should be based in a different place best suited to the needs of that function. So, the HQ might best be in London, the manufacturing in Portugal, the research in Cambridge, and the European distribution centre in Belgium. If many firms each come to roughly the same conclusion, then each place will receive a distinctive set of jobs. London will come to be dominated by HQ people and those who service them. The London, Portuguese and Belgian economies will each come to play a different part in the emerging global economy. This means that certain job skills will find a ready market of employment in each area whereas other skills will not. Hence new spatial divisions of labour may lead to gender- or occupationally- selective in- and out-migration. The dangers of an economy specialising in particular functions will be obvious if there is a downturn in the demand for that type of function. Replacing sectoral specialisation (specialisation by type of product) with functional specialisation (by type of job) may not be a great advance towards balanced regional growth.

The change from a Fordist to a post-Fordist system of production is more a hypothesis than established fact but it does account for certain commonly observed changes in many firms. Among these are the following:

The geographical consequences of these changes are unclear but it may be argued that certain areas will be better geared to coping with the fast changing needs and higher grade workforces needed by post-Fordist firms.

Flexible production is not unrelated to post-Fordist methods of organisation but it is a type of production with clear geographical consequences. It starts from a desire to employ staff only when needed, so there has emerged a 'secondary labour market' where jobs are temporary or part time or on short-term contract. Subcontracting and agency staff may also be used. This new type of employment has serious negative effects on the wealth and spending power of local economies. The firms also do not want to hold large stocks of raw materials, so 'just-in-time' production means that supplies arrive daily just before they are needed on the production line. This has effects on transport (smaller deliveries more often) and on the need to be near to customers since the longer the supply line the less easy it is to guarantee the precise time of delivery every day. Closely packed production districts may be a better pattern of location under just-in-time than more dispersed manufacturing areas, which will have consequences for regional planning. The ultimate flexible firm enters and leaves sectors as profits dictate, and it subcontracts all work to other firms which take the risks. It becomes a 'virtual firm' which comprises a brand name and a core group for investment, monitoring and contract management; Virgin is the best British approximation to a virtual firm.

Study topics

1) Why do firms 'fragment'?

2) What are the features of a post-Fordist economy and how might they affect the geography of manufacturing? What evidence is there of these effects?

3) Why might flexible production systems create new industrial districts? Are there any examples of this?

References

P. Knox and J. Agnew The geography of the world economy (3rd edn) Arnold (1998) DU chaps 6, 7 and 10.
P. Dicken Global shift (3rd edn) Chapman (1998) TD3 chaps 12 and 13.
R. Hayter The dynamics of industrial location Wiley (1997) TDF chap 13.
P. Daniels and W. Lever (eds) The global economy in transition Addison Wesley Longman (1996) TW chaps 3 and 4.
P. Lloyd and P. Dicken Location in space (3rd edn) Harper Collins (1990) DU chaps 9 and 10.
A. Lipietz The local and the global: regional individuality or interregionalism. Transactions of the Institute of British Geographers 18 (1993) 8-18 DG6.
D. Massey Spatial divisions of labour Macmillan (1984 and 1995) TDFea.
A. Tickell and J. Peck Accumulation, regulation and the geographies of post-Fordism. Progress in Human Geography 16 (1992) 190-218 DG6.
R. Hudson New concepts: new production geographies? Transactions of the Institute of British Geographers 19 (1994) 331-345 DG6.
A Sayer Post-Fordism in question International Journal of Urban and Regional Research 13 (1989) 666-695 K6.

The International Labour Organisation's child labour site.

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BLOCK 7 BUSINESS SERVICES SECTOR

The service sector is now officially regarded as being the largest single element in employment in most developed-world countries. Its growth in employment terms far outstrips its contribution to GDP or exports but its growth continues. Arguably (Maslow) once people's material needs have been met, they want to buy 'services' such as entertainment, education and health. It is difficult to 'automate' services, particularly of a person-to-person nature, hence the buoyancy of employment in this sector. Increasingly the service sector is becoming a bigger part of world trade (e.g. tourism, music, films, software, financial services).

The traditional idea of services as the 'tertiary' sector of the economy is a poor definition since it is a negative one ('services' are just all that is not primary (e.g. agriculture) or secondary (manufacturing)) rather than a positive one. What is it that unites activities as diverse as haircutting and foreign exchange dealing and separates the skilled manual work of a surgeon from that of a carpenter in the construction industry? 'Services' is a 'chaotic conception' but quite a useful one nonetheless.

The scale of the sector is hard to measure. If measured by the employers' main activity, the sector is smaller than if it is measured by what each employee actually does. Also the size of the sector depends on firms' desire to keep service work in house (where 'services' tend to disappear from statistical view) or to sub-contract such work to specialist firms (when they re-appear for enumeration). The service sector is also notorious for the extent of the 'black' economy - unrecorded, untaxed and even illegal activities whose scale can only be roughly estimated.

The traditional view was that the service sector was unproblematic and not really worth studying since its geography was simply a reflection of where people lived. Much has happened to change that idea.

First, import penetration and exports of services are growing, so the sector is of more balance-of-payments importance. Second, the sector is very unevenly distributed with clear core areas for software engineering, finance and tourism, for example. Third, there are many hypotheses about the post-industrial society and the service class which see an area's engagement with the service sector as being the part of the area's economy which gives it its distinctive character today (in the past it would have been the areas' activities in farming or manufacturing that would have been the key features geographically.

Among the key trends in the service sector are these:

There are also some counter-trends to major companies competing in part on price to supply standard services as cheaply as possible to global markets (e.g. telephone banking and helplines). There are niche service markets emerging for private medicine, complementary medicine, small publishing houses, distinctive restaurants, specialist retailers and private banking.

The parts of the service sector that areas participate in can become their defining geographical features in terms of image and types of jobs - tourist resorts, cultural centres, research nodes, financial capitals, etc. The locational requirements of the service sector are also distinct as regards the parts of cities in which they operate, the CBD or edge-of-town office parks, for example. Note also the strong trends to decentralisation of office activities occasioned by re-building, architectural fashion and firms' expansion.

Study topics

1) Why are city centres such an attractive location for office activities? Are there any challenges to that attractiveness?

2) Could anywhere be or become a centre for tourism and leisure/ Justify your answer.

3) Some parts of the service sector (e.g the media, software, films and music) require creativity to flourish. Can there be a policy to boost an area's creativity and what might it be?

References

P. Dicken Global shift (3rd edn) Chapman (1998) TD3 chaps 7 and 11.
M. Healey and B. Ilbery Location and change OUP (1990) DU chap 13.
P. Daniels and W. Lever (eds) The global economy in transition Addison Wesley Longman (1996) TW chaps 5, 8, 16, and 17.
J. Wheeler et al. Economic geography (3rd edn) Wiley (1998) DU
N. Marshall and P. Wood Services and space Longman (1995) TDCS.
A. Hallsworth The new geography of consumer spending Belhaven (1992) TJRC
P. Daniels Service industries in the world economy Blackwell (1993) TDCS.
D. Price and A. Blair The changing geography of the service sector Belhaven (1989) TDCS.

The London Stock Exchange's 'Factfile' and 'International comparisons' sections.

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BLOCK 8 LEISURE AND TOURISM SECTORS

Tourism and leisure (T+L) is a major growth sector and a major change in people's consumption patterns. Its potential to boost economic development is matched only by fears of its environmental effects. The interesting feature geographically about T+L is how it can be developed in different forms in many very distinct locales (e.g. Blackpool, Benidorm, Bath, Brixton and Bradford are all tourism and leisure centres for different markets).

The sector is very large (and rapidly growing) though its exact size is hard to measure due to definitional issues (what and who exactly is a tourist? what is leisure?), and much leisure activity is hard to record (e.g. when at home). There is a tendency for the industry to over-estimate its size for commercial and political reasons. The growth of T+L is partly a matter of legislation (e.g. on paid holidays) and partly a matter of rising living standards. The greater distances travelled reflect the growth of cheaper modes of travel and the activities of tour operators creating holiday packages.

Among the key trends in the T+L sector are the following:

The further development of T+L poses a set of dilemmas for policy makers, which are economic, environmental and cultural.

Economic issues

That T+L can create jobs directly and indirectly is not in doubt. The jobs may be low paid, low skilled, have a high turnover, and be part-time/seasonal. So is T+L a good sector to encourage in an economy or does it 'crowd out' better paid jobs in other sectors? Issues of dual labour market and 'imported' labour and leakages of expenditure to other areas are also issues. Numerous areas try to deal with these issues by developing year-round T+L facilities which will employ local people all year and in other ways try to reduce the seasonality of the industry.

Environmental issues

The environmental issues focus on pollution and congestion. Pollution may arise if many tourists arrive but sewage and other facilities have not been upgraded to cope. Congestion can arise if too many tourists arrive at once and overwhelm roads and towns built for smaller numbers. The dilemma is whether to expand capacity to cope or to leave the area in its original form and let the congestion itself act as a disincentive to further arrivals. The question often asked now is whether the tourist industry and the tourists should pay to clean up after themselves (rather than leaving this to the local taxpayer).

Cultural issues

Some of the cultural issues surrounding T+L focus on the 'T+L poor' (the 'unholidayed') since holidays are expensive and can define lifestyles and express one's personality. When not affordable, their absence may be seen as a new form of deprivation. The way T+L changes areas (the relations between hosts and visitors) can be problematic when tourism is on a large scale. The re-branding of areas to appeal to tourists can degrade traditional cultures and create false histories and characteristics for places even when authenticity was the aim. The competition among T+L providers may lead to cost cutting and the adoption of the same 'best practice' and so promote a growing sense of placelessness as everywhere comes to seem the same. Undoubtedly T+L are major forces re-creating places.

Study topics

1) Try and draw up a balance sheet of arguments for and against using tourism as a key element in the regeneration of a lagging economy.

2) Can an area be operating at its full capacity for tourism and leisure? How might one go about determining the level of activity that 'full capacity' represents for an area?

3) To what extent do tourism and leisure developments (re-)create places?

References

P. Daniels and W. Lever (eds) The global economy in transition Addison Wesley Longman (1996) TW
G. Shaw and A. Williams Critical issues in tourism: a geographical perspective Blackwell (1994) TYI.
A. Williams and G. Shaw (eds) Tourism and economic development: Western European experiences (2nd edn) Belhaven (1991) TYIdw
A. Mathieson and G. Wall Tourism: economic, physical and social impacts Longman (1982) TYI
C. Law Urban tourism Mansell (1993) TYI
R. Sharpley Tourism and leisure in the countryside Elm (1993) TYIea
E Cater and G. Lowman Ecotourism: a sustainable option Wiley and RGS (1994) DUHWT

The British Tourism Authority.
Tourism Concern, a pressure group critical of current tourism practices.

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BLOCK 9 GENDER AND ECONOMIC GEOGRAPHY

The study of gender in relation to economic geography is perhaps a newer field than gender studies in social geography but it is now an important aspect of the subject. The study began from the observation that men and women participate in the economy in different ways and to different extents, and that this relationship was not the same historically or geographically. The research on women in paid work has focused on: (i) describing the role of women; (ii) explaining why their role is different; (iii) examining ways of equalising their roles.

The ways in which men's and women's roles differ in the formal paid UK economy include the following: women are less likely to have any paid work; they work part time much more often; they do less overtime; are paid less per hour; will more likely be in lower-grade positions; will take career breaks; will be promoted less often; will cluster in certain occupations and sectors and not in others; will drop out of the labour force when unemployment rises rather than be formally unemployed; will work from home more often; retire earlier; are less often self-employed; are less career mobile geographically when they have partners.

A hundred years ago in the UK women's role was different from that we see today. Many fewer women worked; paid work outside the home usually stopped completely on marriage; only early widowhood might bring women back into the labour force after they had left it; a few industries (and the regions where they were found) had relatively high levels of female workers (e.g. women in the cotton industry in the NW) and London even 100 years ago provided more jobs for women; domestic service was the biggest source of female employment; women's relative wages were even lower than those today; what are today traditionally female jobs were then male jobs (e.g. teaching and secretarial work).

The biggest changes have been in the proportion of women who have paid work, the lengthening of women's working lives, the narrowing of the gap in pay, the far greater number of women with children who have paid work; and the much wider range of jobs women are now found in. These changes have not affected all women equally. The biggest changes have been in the 'professions', for younger, middle-class, skilled and graduate white women. Low skilled women and those from some ethnic minorities and older women retain more of the traditional pattern of women's work as do those in rural areas compared with the conurbations.

The trends in the UK have been mirrored in many developed countries; rather less so in southern Europe and more so in Scandinavia. The critical issue, apart from rapidly changing social norms, has been the extent of the provision of childcare for women with children who want paid work.

The work trying to explain women's more subordinate but changing position in the formal economy rests on three theoretical constructs - the effects of capitalism, partriarchy and familial ideology.

Capitalism always seeks out cheaper labour and traditionally women have been a 'reserve army' who have been prepared to work for lower wages and more flexibly so as to provide top-up family income rather than full wages. Areas with large numbers of women workers (e.g. textile areas) or potential workers (e.g. heavy industry or rural areas) have often been targeted by assembly-line firms that want a lot of cheaper labour. Employers often stereotyped women workers as less militant, less unionised and more willing to operate according to agreed procedures. This weak position for women has been changed by (i) more women being in work; (ii) the growth in single women as earners (they need a full wage); (iii) the rising consumption expectations in two-income families. Women in the LDCs now more closely mirror the traditional economic role of women than those in the developed world.

Patriarchy was/is the view that women cannot do certain jobs (or do them as well as men) by virtue of their lesser strength or aptitude. This might extend to the view that women should not do jobs at the expense of male employment. Women's role was to mop up the jobs for which there were not enough men to take on. Patriarchy is a view which is less commonly held than previously but it still exists (more powerfully in some areas than others) and elements of patriarchy may explain the 'glass ceiling' which still restricts the promotion prospects of women in many areas.

Familial ideology is a set of views which stresses that the primary role of women is to have and to look after children, and that paid work should only be fitted in where it does not conflict with or damage that caring role. Up to the 1930s it was quite normal for there to be agreements between trades unions and employers that women would resign their jobs on marriage. There has been a major change in attitudes with many now accepting that women can have families and careers but traces of familial ideology still exist in controversies about the best methods of childcare and the effects of women working on children's development.

The future role of women in paid work in the formal economy will be determined as in the past to a minor degree by legislation (e.g. on childcare provision, discrimination and equal pay) and to a major extent on societies' general views on women's proper role.

Study topics

1) To what extent is it true that highly skilled women have advanced further in the world of formal paid employment than other women? Why might this be? How might the economic position of lower skilled women be improved?

2) To what extent do patriarchy and familial ideology still shape the role that women play in the formal economy?

References

P. Daniels and W. Lever (eds) The global economy in transition Addison Wesley Longman (1996) TW
Institute of British Geographers (Women and Geography Study Group) Geography and gender (1984) KDQWJ chap 4.
S. Duncan The geography of gender divisions of labour in Britain. Transactions of the Institute of British Geographers 16 (1991) DG6
S. Pinch and A. Storey Flexibility, gender and part-time work. Transactions of the Institute of British Geographers 17 (1992) 198-214 DG6.

The US Equal Employment Opportunity Commission.
The UK Equal Opportunities Commission.
The World Bank's gender site.

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BLOCK 10 REGIONAL AND LOCAL ECONOMIC DEVELOPMENT POLICIES

Under capitalism economic development tends to be dependent in part on local factors and to be uneven in its growing and declining sectors. It is therefore inevitable that economic activity will operate at different levels in different places and that unemployment levels and activity rates will differ. If, under a perfect economy, resources could move cheaply and swiftly from where they were under-used or under-remunerated to areas where they were needed, then many such irregularities in the geography of development would be smoothly ironed out. In practice factor mobility is less than instantaneous or complete and so pockets of faster and slower growth will co-exist within any state and between states. Hence there is a political problem for most governments most of the time - should they leave market forces to encourage factor mobility (let the problem solve itself) or should they intervene to try and speed up the process of economic convergence among the sub-regions of the state?

In this block we look at three key questions. Why should governments intervene in regional and local development? How can they intervene? What are the features and effects of their intervention?

Why intervene?

Several justifications are used by governments (local and national) for intervening to boost local economic growth rather than leaving adjustments to the free market.

(i) Issues of safety, health and externalities; these tend to be small-scale issues about the exact positioning of facilities so as to protect the public. This may involve bigger issues in very sensitive areas such as environmentally sensitive areas, national parks or nuclear power.

ii) Strategic or military issues may dictate that facilities are provided for reasons of self-sufficiency or are placed where they will be safer from attack by hostile forces.

(iii) It is much easier to manage a national economy if all its constituent areas are at the same level of economic activity; if one is booming and another lagging or in recession, then no one policy for national economic management will suit all areas.

(iv) Governments may see their role as being to provide an equality of economic opportunities to all sections of society and all regions irrespective of where the party in power draws its political support from.

(v) Being seen to help all regions may legitimate the government's hold on power, it may gain them votes in areas helped, and it may stifle any trend to political opposition or separatist movements in areas where the economy is lagging.

(vi) In 'new' countries, it may be important to 'fill the frontier' by encouraging development and hence settlement across the whole of the national territory so as to stop any territorial claims by neighbouring states.

(vii) It is hard to stop assisting your regions if other countries are doing the same thing; one might find oneself at a disadvantage for mobile investment compared with competitor states.

How might governments intervene?

(i) At national level they might erect tariff or non-tariff barriers to imports so as to protect local producers. Tariff barriers are more difficult now because of international agreements to reduce barriers. Such protection might make local firms inefficient and so the barriers may become permanent, which may lead to higher prices for consumers.

(ii) Governments are in their own right significant buyers of goods and services from the private sector, from paper clips to fighter aircraft. One might use this purchasing power to favour local suppliers and their suppliers in turn. Privatisation, the run-down of armed forces and the EU's need for open competition for supplies are making this form of intervention less easy but not impossible.

(iii) Regional policy. Many methods can be used.

(iv) Growth poles. It is sometimes argued that if public and private investment is concentrated in one sector and in a small area (a 'growth pole') then the effects of that initial investment in terms of attracting more investment and increasing the multiplier from investment will be greater than if the initial investment had been spread widely. A concentration policy may be more effective but does less for equity considerations.

(v) Local economic initiatives These have recently become more popular. The idea is to encourage the institutions of the locality to form partnerships and agree on what the area needs rather than leaving it to central government to provide what it (perhaps mistakenly) thinks the area needs and will support.

Effects of government intervention

This is an area of much research and controversy. Among the key issues are these. How can you measure the effects of any regional policy measure when so much else is happening in parallel? What would have happened in the absence of the policy (the problems of additionality and deadweight)? How does one policy compare with what might have happened if the money had been spent otherwise (the problem of opportunity cost)? Were there any undesirable side effects from the policy? How do governments solve the dilemma that an unchanging policy may be wrong or outdated but it will be widely understood, whereas many changes of policy may be confusing and counter-productive? It is politically hard to remove a once useful policy. A policy of subsidy may lead to firms relying on it to support them in their inefficiency. It is never clear whether a policy can achieve all it set out to do, yet policies with a few simple clear goals are unusually vulnerable to being shown to be ineffective, which is politically embarrassing.

There is still a great deal of controversy over whether and how best governments (local, national or supranational) should intervene to even out the inherent variations in the intensity of free-market capitalism.

Study topics

1) Traditional subsidy systems still play a key role in attracting firms to areas in need of an economic boost. What are the drawbacks of such methods of local economic development? Why are such methods still used?

2) Explain the success of any region or country in attracting a high level of external investment.

3) Why precisely is it so difficult to evaluate the effectiveness and efficiency of any regional policy?

References

P. Knox and J. Agnew The geography of the world economy (3rd edn) Arnold (1998) DU chaps 10-12.
P. Dicken Global shift (3rd edn) Chapman (1998) TD3 chap 13.
M. Healey and B. Ilbery Location and change OUP (1990) DU chaps 15 and 16.
R. Hayter The dynamics of industrial location Wiley (1997) TDF
P. Daniels and W. Lever (eds) The global economy in transition Addison Wesley Longman (1996) TW chap 15.
J. Wheeler et al. Economic geography (3rd edn) Wiley (1998) DU chaps 9 and 11.
D. Smith North and South: Britain's economic, social and political divide. (2nd edn) Penguin (1994) TBFea
H. Armstrong and J. Taylor Regional economics and policy (2nd edn) Harvester and Wheatsheaf (1993) TBF Part 2.
G. McCrone Regional policy in Britain Unwin (1990) TBF. Part 2.

You might like to contrast the methods of promoting economic development used by the following agencies:
Udaras na Gaeltachta; the development agency for the Irish-speaking parts of rural western Ireland.
Scottish Enterprise; the development agency for (mostly urban) Scotland.

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MODEL EXAMINATION ANSWERS

Suppose that you have chosen to answer this examination question:
Describe and explain the changes in UK forestry policy since 1919.
How might you structure an answer in 45 or 60 minutes?

There are several approaches which could be used; the one which follows is not the only one nor even necessarily the best one, but it would be a 'safe' type of answer.

First, analyse the elements in the question's title. There are two tasks - to describe and to explain; you need to do both. The focus is on policy and changes in it, not on, say, the environmental effects of forestry. There are clear restrictions on the type of material you can use: area = UK; period = since 1919; field = forestry. If you do not know about these issues you cannot substitute non-British, historical or agricultural material.

A possible structure for an answer would be a chronological one; take a series of periods from 1919 to the present and for each describe the policy and policy aims operated then and explain why they were used, what forces built up to alter the policy in a later period and the way the change to the new policy took place. For example:

1) Why was policy set up with the Forestry Commission in its then form in 1919? What was new about this compared with pre-1914 policy?

2) What was policy trying to do in the inter-war period - public spending cuts, fear of a new war, Great Depression?

3) The post-war period might be divided into three overlapping periods such as:

Try to link the changes in forestry to wider changes (e.g. Thatcherism). Leave room in your 45-60 minute answer for the most recent periods (e.g. environmentalism, privatisation, community forests).

Leave room also for a final paragraph which will summarise the main trends, and briefly note the major continuities over the whole period since 1919 and the major shifts since then. Is there any overall model that would characterise British forestry policy in this period?

As you will see the final sections of the answer are very important so you need to deal with the 1950s-1980s swiftly so as to leave yourself time to bring the story up to date, to summarise and to sketch out the major features of the chronology.

The answer should be grounded in real events so reference actual schemes, places, authors and statistics to illustrate your points.

Here are some other possible types of examination questions and answers.

Describe and account for the principles of town planning used in the UK and USA since 1960.

Comments

1) You have to do what the question tells you to do. It would be wrong "to describe" but not "to account for".

2) "The principles" - it would be wrong to focus on one principle and ignore the others. One principle may be dominant and get more attention, but this should not be to the exclusion of the other principles.

3) "In the UK and USA" implies substantial though not necessarily equal coverage of both countries. References to other countries should be limited to key comparisons or statements of where UK/US planning ideas came from or were subsequently adopted.

4) "Since 1960" means the whole period, not one decade. If one sub-period was particularly influential then it can get more attention but not to the exclusion of the rest of the period. Material prior to 1960 should be used very sparingly, perhaps to sketch the origins of post-1960 activity.

Explain the reform of the Common Agricultural Policy since 1980.

Comments

1) It would be wrong to spend so much time describing the CAP and its effects and weaknesses that one is left with little time to deal with its reform (the focus of the question). "The reform" implies some coverage of what is being reformed (the current structure) and why reform is needed (the problems with the CAP), but there must be good coverage of what reforms are in place and their effects and of what reforms are proposed.

2) The question could be answered from an economic perspective (the income/costs/production effects on farmers and consumers in different places) or from a political perspective (the power blocks lobbying for and against particular reforms). A good answer would include both perspectives on reform.

3) "The reform" is a singular noun but that does not mean that the CAP has only one set of critics, one problem and one possible direction of reform. A good answer might note how the criticisms, arguments and types of reform have varied (i) over time and (ii) among the different countries and interest groups.

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