22@: a high-tech zone located on a brownfield site inBarcelona.
Agglomeration: a group of industries in the samelocation.
Agglomeration Economies: savings which arise from theconcentration of industries in urban areas and their location close to linkedactivities. e.g. A car factory attracts component suppliers to locate close by,saving on transport costs. Other savings are made in labour and training costs,and the use of the services found in urban areas, e.g. housing, banking, roads,electricity, etc.
Assembly Industries: see Screw Driver Industries.
Assisted Areas: see Development Areas.
Balance of Trade: the value of exports minus the valueof imports; there may be a trade deficit or trade surplus.
Break of Bulk Location: a location such as acoastal port which takes its advantage from a position where there is a forcedtransfer of raw materials or goods from one form of transport to another.Coastal locations are favoured for iron and steel plants in the UK since thecoal and iron ore raw materials are now imported.
Brownfield Site: an inner-city derelict site which canbe cleared and reused for new industry.
Business Parks: these are mainly found on edge-of-citygreenfield sites, although some are part of inner city redevelopment schemes.Usually over 70% of the land is converted into ornamental gardens and lakes.They are ideal locations for high-tech industries such as electronics andresearch institutions.
By-products: what is left over after something is madee.g. chemicals following the refining of oil. Some by-products can be treated tomake other products.
Capital: wealth created for use in the production offurther wealth. Examples of capital are money, machines and buildings.
Capital Intensive: an activity which requires a lot ofmoney.
Cheap Labour: See Overseas Competition.
Colonial Period: the structure of world trade today hasits origin in the colonial period when MEDCs used LEDCs as sources of rawmaterials for their factories.
Commercial: used to describe the business activities oftrading and buying or selling goods.
Commodity: products produced for export.
Components: parts of a product that are transported to afactory (plant) for final assembly e.g. brakes, lights, wheels, glass, sealsetc. are all car components.
Congestion: usually concerned with transport when thereis so much traffic it stops or slows down the movement.
Containerisation: goods being packed into large metalboxes for transport by road and/or sea.
Core Region: an area at the heart of economic activitye.g. a well-off industrial region of a country e.g. South-East England. See IndustrialDevelopment Certificates, Cumulative Causation, Multiplier Effect andAgglomeration Economies.
Cumulative Causation: the process by which one region ofa country becomes increasingly the centre of economic activity. (See agglomerationeconomies and multiplier effect).
Cycle of Decline (Deprivation): as traditionalindustries close, job losses lead to less money in the area, with a 'knock-on'effect on other businesses such as suppliers, shops, etc. More businesses areforced to close and the problem becomes worse and worse. The most able workersmove away to other areas; the area becomes more run-down with high crime,vandalism etc. and an ageing population.
Decentralisation: the movement of shops, offices andindustry away from urban centres in MEDCs and NICs into retail and businessparks in the suburbs. Recent trends have been to decentralise still further outinto many semi-rural locations. High land and labour costs are two of the mainpush factors.
Declining Region: one where traditional heavy industriesare closing down leading to high unemployment and out-migration e.g. SouthWales. See Deindustrialisation and Cycle of Decline.
Deindustrialisation: the decline of a country'straditional manufacturing industry due to exhaustion of raw materials, loss ofmarkets and competition from NICs.
Derelict Land: waste land with decaying houses andclosed-down industry, typical of inner city areas in MEDCs.
Development Areas: areas of high unemployment in the UK;the government tries to encourage industries to move to these areas by offeringincentives:
labour subsidies
purpose-built, rent-free factory sites
tax-free periods of up to 10 years
grants for machinery and equipment
excellent communications (motorways)
retraining schemes to provide a skilled workforce
Division of labour: increased productivity gained whenworkers specialise in one particular part of the manufacturing process e.g.fitting windscreens in a car plant. They become faster and more skilled.
Economic Base: a wide economic base is typical of MEDCswhere many industries contribute to generating wealth. A narrow economic base istypical of LEDCs where only a few industries contribute.
Economic Development: the generating of wealth throughthe development of industry.
Economic Infrastructure: transport networks; gas,electricity, water grids; sewerage systems, etc.
Economies of Scale: savings made as a result oflarge-scale production, through buying in bulk, division of labour etc.
Employment Structure: See Occupational Structure.
Enterprise Zones: small run-down inner-city areas andother areas of industrial decline with high unemployment in the UK wherefinancial incentives are available to encourage investment and renewal. Thegovernment gives tax concessions to firms, grants for buildings and machinery,removes various planning restrictions and improves communications andinfrastructure e.g. London Docklands.
Exports: goods sold abroad.
Feedback: the reinvestment of some of the profits intonew inputs within the factory system.
Fixed Industry: one which is tied to a particularlocation.
Footloose Industry: one which could set up in manydifferent locations. It is not tied to a fixed location. It may locate wherelabour is cheaper, or where the government offers incentives.
Formal Employment: where people work to receive aregular wage and are assured certain rights e.g. paid holidays, sickness leave.Wages are taxed.
Global Economy: industrial location is no longer linkedto one specific country; choices of location are global and depend on strategiesto sell the maximum number of products with the lowest costs possible. See OverseasCompetition.
Globalisation: This is the trend where people arebecoming more interconnected and interdependent. Information technology isdriving this trend by enabling companies to move money and ideas instantly atthe click of a mouse. The ways in which goods and information are moved betweencountries are becoming easier.
Government Disincentives (Controls): include Green Beltand Industrial Development Certificates.
Government Incentives: include Grants, Labour Subsidies,Tax-Free Periods, Rent-Free Periods, Removal of Planning Controls, improvementsin Infrastructure and Communications, Purpose-Built Factories, Greenfield Sites,worker Retraining schemes and New Towns.
Government Policy: aims at attracting labour-intensiveindustries e.g. assembly plants to areas of high unemployment. UK has beencalled 'Taiwan of Europe' with Japanese trans-nationals locating their branchplants in areas of cheapest labour, taking advantage of government grants. See GovernmentDisincentives and Government Incentives.
Grants: money paid to an industry towards the cost ofnew machinery, training etc. These are given in Development Areas to attract newindustry.
Greenbelt: a zone of farmland, parkland or opencountryside which surrounds an urban area and is designed to prevent urbansprawl. The zone is protected from new developments by law.
Greenfield Site: an industrial site often located on theedge of of town, previously used for farming or other rural activity.
Gross National Product (GNP) per capita: the total valueof goods produced and services provided by a country in a year, divided by thetotal number of people living in that country.
Heavy Industry: one with heavy/bulky raw materials andheavy/bulky finished products e.g. Iron and Steel. These industries tend to bevery polluting.
High-Tech Industries: these involve the use of researchand development to create high value, technology-based products and processes.
High-Tech Agglomerations: by locating near each other,high-tech firms are able to exchange ideas and information, share trainingservices and amenities such as calibration laboratories and research facilities.They have access to a pool of highly-skilled labour. See Business Parks.
Human and Economic Location Factors: include laboursupply, capital (money), markets, transport, government policy, economies ofscale, improved technology, recreation/environment.
Imports: goods bought from abroad.
Import Substitution: when a country (LEDC) tries toproduce all its own goods and services in order to limit imports.
Industrial Classification: the categorization ofindustry into Primary, Secondary, Tertiary, Quaternary sectors.
Industrial Development Certificates: these are issued bythe UK government to control where industry can locate; they are difficult toobtain for firms wishing to locate in the South-East of England. See CoreRegion.
Industrial Estate: an area of land planned and zoned forindustry, usually with good access to the motorway network.
Industrial Inertia: the survival of an industry in anarea even though the initial advantages of location are no longer relevant. e.g.the survival of the steel works in Sheffield is due to the prestige of Sheffieldcutlery.
Informal Sector: This is particularly strong in LEDCsand made up of work done without the official knowledge of the government andtherefore without paying taxes.
Informal Work: this involves jobs people have set up forthemselves, such as shoe shining. The jobs require little capital to set up,require few skills, are labour intensive, small scale and can often be done fromhome.
Infrastructure: the facilities which provide theessential framework for industry e.g. roads, power supply, sewerage etc.
Inputs: the things needed to run a factory e.g. capital,raw materials, power, labour etc.
Invisible Trade: trade in products that cannot be 'seen'e.g. tourism, financial services and technological 'know-how'.
Job Rotation: workers are skilled in a number ofdifferent jobs and several people are capable of doing each job. This ensuresthat each job can be covered in the case of absence. It also means that jobs canbe regularly rotated to prevent a worker from becoming bored in a particularrole.
Just-in-Time: a production system where components aredelivered just in time for assembly. This saves transport and storage costs aswell as theft.
Kaizen: a Japanese concept meaning 'continuousimprovement'. Kaizen requires workers thinking about improvements day by day andminute by minute.
Knowledge Economy: the new economies based on theprocessing of knowledge and information using telecommunications.
Labour-intensive: industries where labour costs are highcompared to capital costs, e.g. clothing.
Labour Location: access to skilled labour is a veryimportant factor in the location of modern industry today.
Land-locked: countries with no access to a seaport. Thisis a particular problem for LEDCs, e.g. Zaire and Zambia that are heavilyreliant (60% and 98%) on the export of copper.
L.D.D.C.: London Docklands Development Corporation giventhe task by the government of clearing large areas of derelict land in LondonDocks and selling the sites to property developers. The L.D.D.C. was alsoinvolved in improvements in infrastructure to attract new industry.
Light Industry: manufacturing industry which has lightraw materials/components and finished products.
Locational Factors: things that affect where industrydecides to set up - usually in the most profitable place.
Logistics: the management and control of the flow ofgoods and services from the source of production to the market. It involvesknowledge, communication, transport and warehousing.
London Docklands: a declining inner city area designatedan Enterprise Zone by the government to attract new industry and employmentafter the closure of the docks.
Machinery: used in industrial processes to produce thefinished product for sale. (Manufacturing).
Market: where industrial products are bought and sold.
Market Location (for industry): where transport costsfor the finished product exceed the transport costs of the raw materials.Transport costs are lowest if the raw materials are transported to the factorylocated at the market and processed there. Today, since power (electricity) canbe transported over long distances, a market location is more important than araw material (coal) location.
Minerals: found in rock. They may be mined or quarriedand then either melted down like iron ore (iron) or bauxite (aluminium), or usedas a source of power (coal, oil).
Multiplier Effect: the 'snowballing' of economicactivity. e.g. If new jobs are created, people who take them have money to spendin the shops, which means that more shop workers are needed. The shop workerspay their taxes and spend their new-found money, creating yet more jobs inindustries as diverse as transport and education.
Natural Routes: river valleys and flat areas wereessential transport routes in the days before the railway, car or lorry.
Newly lndustrialising Country (NIC): LEDCs which aredeveloping manufacturing industries, usually with the help of Trans-nationalCorporations attracted by cheap labour and Government Incentives. e.g. SouthKorea, Hong Kong, Taiwan, Malaysia, Brazil, India.
Occupational Structure: the balance between thedifferent sectors of a country's workforce e.g. primary, secondary, tertiary,quaternary. See table below.
| MEDC | NIC | LEDC |
|---|---|---|
| Mainly tertiary | Mainly secondary | Mainly primary |
Open-Cast Mine: a large quarry where a large pit isexcavated on the Earth's surface to remove rock.
Ore: a rock containing minerals useful to people, e.g.iron ore, gold ore.
Outputs: products from a factory system, which includepollution and waste.
Overheads: costs which do not vary with output; thesecosts include rent, wages, electricity, etc.
Overseas Competition: NICs have the advantage of cheaplabour, expanding national markets and the newest technology. This has led to aglobal shift of manufacturing industry towards South-East Asia.
Peripheral Region: an area on the fringe of economicactivity e.g. a poor backward region of a country. An example is South Wales.
Physical Factors affecting Location of Industry: includeraw materials, energy (power supply), natural routes, site and land.
Post-Industrial Economy: the economies of economicallydeveloped countries where most employment is in service industries.
Power: this is needed to work the machines in thefactory. Early industry needed to be sited near to fast- flowing rivers or coalreserves, but today electricity can be transported long distances and the sizeand location of markets have become more important as a location factor.
Prestige: the image of a company, gained from itsheadquarters address (e.g. Oxford Street, London) or its its traditionalhigh-quality manufacturing location e.g. Sheffield (steel). See IndustrialInertia.
Primary Industry: industry concerned with extractingnatural resources from the ground or the sea, e.g. agriculture, fishing,forestry, mining and quarrying. The output of such primary production oftenneeds further processing.
Primary Product Dependency: see Single ProductDependency.
Processes: the activities that take place within afactory e.g. rolling out steel.
Producer Services: services for manufacturing and othertertiary industries, e.g. advertising, legal services, management consultancy,market research.
Profits: money left over when wages, interest, rent, rawmaterials and other costs have been paid by businesses. Profits are thefinancial reward for taking risks.
Quarry: a large pit dug to obtain a mineral from theground. Rocks and ore are quarried.
Quaternary Industry: one which uses modern technology tocarry out research, handle information and give advice to other industries.
Raw materials: items from which more complex items aremade. Steel is made using coal, iron and limestone: coal, iron and limestone areraw materials.
Raw Material Location: the bulkier and heavier these areto transport, the nearer the factory should be located to the raw materials.With the decline of traditional heavy industry, the three main factors decidingindustrial location today are the nearness to a large market, the availabilityof skilled labour and government.
Recreation: leisure activities; what people do in theirnon-working time.
Research and Development: the branch of a manufacturingfirm concerned with the design and development of new products. R&D employshighly skilled workers and is often located close to the company HQ.
Retraining Schemes: government-funded schemes to retrainunemployed workers in Declining Areas in the new skills required by high-techAssembly industries attracted by Government Incentives.
Science Parks: An area of land, often located nearuniversity sites, where high-tech industries are located. Scientific researchand commercial development are carried out in co-operation with the university.
Screwdriver industries: industries based on the routineassembly of products manufactured elsewhere e.g. Sony, South Wales.
Seam: see Coal Seam.
Secondary Industry: the manufacturing of goods using theraw materials from primary industry.
Service Industry: see Tertiary Industry.
Silicon Glen: a high-tech zone in Scotland.
Silicon Valley: a high-tech zone in California.
Single Product Economy: a country (usually LEDC) whichrelies on one, or a very small number, of products (usually raw materials) forits export earnings. e.g. Zambia, copper makes up 98% of its exports; Uganda,95% coffee beans.
Site: ground on which a factory stands or is to stand orbe located. Last century many sites were in today's inner city areas whereas nowthey tend to be on cheaper edge-of-city Greenfield locations
Structure of Trade: the differing proportions ofprimary, secondary and tertiary products that make up a country's exports andimports e.g. LEDCs export low-value raw materials and commodities and importhigh value machinery and consumer goods from MEDCs. See Single ProductEconomy.
Subcontract: where a large company, e.g. Nike, arrangesfor its goods to be produced by another company.
Subsidy: a grant of money made by the government toindustries locating in Development Areas; industries locating in South Walesreceive a labour subsidy per worker, which encourages them to employ morepeople, reducing their costs and increasing profits.
Sunbelt: a growth region of high-tech industry in thesouth west of the USA.
Sunrise Industries: high -tech industries.
Sunrise Strip: a high-tech industrial zonefollowing the route of the M4 westwards to South Wales.
Tariffs: tax (customs duties) charged on imported goods.e.g. manufactured goods from LEDCs to the EU face a tariff of 30%. Japanesecompanies have located in the EU to avoid tariffs; these do not apply if 60% ofthe components are made in Europe.
Teleworking: using telecommunications to work from home.
Terms of Trade: the relationship between the averageprice of exports and the average price of imports. Terms of Trade always favourMEDCs at the expense of LEDCs. See Structure of Trade.
Tertiary Industry: does not produce anything butinvolves work in the service sector of the economy. It includes activitiesassociated with commerce and distribution (wholesaling and retailing) as well asbanking, insurance, administration, transport, tourism, health, education andentertainment services.
Trade Deficit: where a country imports more goods thanit exports.
Trade Surplus: where a country exports more goods thanit imports.
Trading Blocs: groups of countries who jointogether for tax-free trading purposes e.g. the EU.
Traditional Industries: old heavy industries locatedwhere cheap energy (coal) and raw materials, e.g. iron ore were found.
Trans-national Corporation (TNC): large companieswhich have branch plants throughout the world; their headquarters are oftenfound in MEDCs.
Urban Diseconomies: the rising costs to industry ascities increase in size, due to increasing cost of land and labour, trafficcongestion, crime etc.
Urban-Rural Shift: the movement of industry away fromurban areas in recent years due to urban diseconomies, improvements incommunications (motorways) and telecommunications (internet/fax/computer links),counter-urbanisation (the move of the middle class workforce to small towns andvillages) and planning policies (government incentives, new towns, green belts).
Work: employment at a job or occupation; either formalor informal.
Zoning: where industry is separated from residentialareas to avoid pollution, traffic congestion etc. Zoned areas are a result ofplanning.
