Unit 7 Vocab Flashcards
Agglomeration
grouping together of many firms from the same industry in a single area for collective or cooperative use of infrastructure and sharing of labor resources
Auto Alley
an area of concentrated automobile manufacturing in North America, from southern Ontario to the Gulf of Mexico in the southeastern United States
Back office services
work that is important to the running of a company but is rarely seen by clients such as accounting, planning, inventory management, supply-chain management, human resources and logistics; back offices used to literally be located in less desirable and less visible parts of office buildings but are now often located somewhere other than company headquarters such as in areas and countries with cheaper rent and lower labor costs
Basic industries
businesses (such as manufacturing and mining companies) that sell primarily to external customers and, therefore, bring in revenue to support the nonbasic industries and community
Black market
an illegal trading of goods and services without government’s knowledge in order to avoid price control, tax or government regulations
Break-of-bulk point
point at which a product is transferred from one shipping method to another
BRICS
an acronym that refers to the economies of, Russia, India, and China, which are seen as majoreconomies in the world
Bulk-gaining industry
an industry whose products increase in size or weight during manufacturing
Bulk-reducing industry
an industry whose products decrease in size or weight during manufacturing
Bureaucracy
a system for controlling or managing a country, company, or organization that is operated by a large number of officials employed to follow rules carefully
Business services
services that primarily meet the needs of other businesses
Call center
an office set up to handle a large volume of telephone calls, especially for taking orders and providing customer service
Capitalism
an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market
Closed shop
place of work where membership in a union is a condition for hiring and continued employment
Commodity dependence
A country is considered to be export-commodity-dependent when more than 60 percent of its total merchandise exports are composed of commodities (or basic products and raw materials)
Communism
a political theory derived from Karl Marx, advocating class war and leading to a society in which all property is publicly owned and each person works and is paid according to their abilities and needs
Comparative advantage
an economy’s ability to produce goods and services at a lower opportunity cost than that of trade partners; gives a company/country the ability to sell goods and services at a lower price than its competitors and realize stronger sales margins
Complementarity
when both parties have goods or services that the other party desires
Consumer services
businesses that provide services primarily to individual consumers, including retail services and personal services
Containerization
a system of intermodal freight transport using intermodal containers (also called shipping containers and ISO containers)
Core
In World System Theory, core countries are industrialized capitalist countries on which periphery countries and semi-periphery countries depend. Core countries control and benefit from the global market, usually recognized as wealthy nations with a wide variety of resources and are in a favorable location compared to other states. They have strong state institutions, a powerful military and powerful global political alliances.
Cottage industry
a small-scale industry, where the creation of products and services is home-based, rather than factory-based
Deglomeration
process of industrial deconcentration in response to technological advances and increasing costs
Deindustrialization
the process of social and economic change which is due to the reduction in industrial capacity or the activities of a country’s manufacturing and heavy industry
Dependency Theory
suggests that global inequality is primarily caused by core nations (or advanced economies) exploiting peripheral nations for their resources, which keeps them poor and dependent
Development
process of improving the material conditions of people through diffusion of knowledge and technology
Economic Base
a community’s collection of basic industries
Ecotourism
tourism directed toward exotic, often threatened, natural environments, especially to support conservation efforts and observe wildlife
Export-processing Zone
established by many countries in the periphery and semi-periphery where they offer favorable tax, regulatory, and trade arrangements to attract business and investment (labor is cheaper and environmental restrictions are relatively weak); EPZs offer incentives and a barrier-free environment to promote economic growth by attracting foreign investment for export-oriented production
Fabricated metals
the creation of metal structures by cutting, bending, and assembling processes; a value-added process involving the creation of machines, parts, and structures from various raw materials
Fair Trade
a way of buying and selling products that makes certain that the people who produce the goods receive a fair price
FIRE
Finance, Insurance and Real Estate
Footloose Industry
a general term for an industry that can be placed and located at any location without effect from factors of production such as resources, land, labor, and capital
Fordist production
form of mass production in which each worker is assigned one specific task to perform repeatedly (assembly line)
Foreign Direct Investment
investment made by a foreign company in the economy of another country
Formal Economy
the legal economy that is taxed and monitored by a government and is included in a government’s gross national product
Free market economy
a system in which the prices for goods and services are determined by the open market and by consumers; the laws and forces of supply and demand are free from any intervention by a government, or by other authority
Free-trade zone
an area within which goods may be landed, handled, manufactured or reconfigured, and reexported without the intervention of the customs authorities; organized around major seaports, international airports, and national frontiers—areas with many geographic advantages for trade; examples: Hong Kong, Singapore, Colón (Panama), Copenhagen (Denmark), Stockholm (Sweden), Gdańsk (Poland), Los Angeles, and New York City
GDI
(Gender-related Development Index) compares the level of development of women with that of both sexes as represented by the HDI
GEM
(Gender Empowerment Measure) UN measure of the extent of gender inequality across the globe’s countries, based on estimates of women’s relative economic income, participation in high-paying positions with economic power, and access to professional and parliamentary positions; introduced at same time as GDI but measures topics like empowerment that are not covered by that index
Gender Gap
the difference between men and women when it comes to economic outcomes
Gender Inequality
legal, social and cultural situation in which sex and/or gender determine different rights and dignity for women and men, which are reflected in their unequal access to or enjoyment of rights, as well as the assumption of stereotyped social and cultural roles
Gendered space
areas in which particular genders of people, and particular types of gender expression, are considered welcome or appropriate, and other types are unwelcome or inappropriate
GII
(Gender Inequality Index) a composite measure reflecting inequality in achievements between women and men in three dimensions: reproductive health, empowerment and the labor market
Glass ceiling
invisible but real barrier through which the next stage or level of advancement can be seen, but cannot be reached by a section of qualified and deserving employees, usually due to implicit prejudice on the basis of age, ethnicity, political or religious affiliation, and/or sex
GNP
the total value of all goods and services produced by a country’s economy in a year, including any income earned by residents from overseas investments
HDI
The Human Development Index (HDI) is a summary measure of average achievement in key dimensions of human development: a long and healthy life, being knowledgeable and have a decent standard of living.
Industrial park
a portion of a city that is zoned for industrial use rather than residential or commercial needs; may contain oil refineries, ports, warehouses, distribution center and factories
Industrial Revolution
period of major industrialization that took place during the late 1700s and early 1800s that saw the mechanization of agriculture and textile manufacturing and a revolution in power, including steam ships and railroads, that effected social, cultural and economic conditions; began in Great Britain and quickly spread throughout the world; the American Industrial Revolution, commonly referred to as the second Industrial Revolution, started sometime between 1820 and 1870
Industrialization
the transformation of agrarian-rural societies to industrial-urban societies that are dominated by manufacturing and services
Informal Economy
the diversified set of economic activities, enterprises, jobs, and workers that are not regulated or protected by the state; originally applied to self-employment in small unregistered enterprises, but has been expanded to include wage employment in unprotected jobs
Inputs
resources such as people, raw materials, energy, information, or finance that are put into a system (such as an economy, manufacturing plant, computer system) to obtain a desired output
Interdependence
the mutual reliance and connection between places and regions, where they rely on each other for resources, goods, services, and information
Intermodal transportation
the use of two or more modes, or carriers, to transport goods (freight) from shipper to consignee; special standardized containers are used for intermodal transport of cargo on trucks, freight trains, and ships
International Trade Approach
countries open themselves to foreign investment and international markets to develop economically
Just-in-time Delivery
method of inventory management made possible by efficient transportation and communication systems, whereby companies keep on hand just what they need for near-term production, planning that what they need for longer-term production will arrive when needed
Labor Union
an organization of workers who have joined together to advance their common interests
Labor-intensive industry
an industry for which labor costs comprise a high percentage of total expenses
LDC/developing country
(Less Developed Country) a country that is at a relatively early stage in the process of economic development
Least Cost Theory
Alfred Weber’s theory of industrial location, explaining and predicting where industries will locate based on cost analysis of transportation, labor, and agglomeration factors
Literacy Rate
percent of the population that can read and write (usually at an 8th-grade level)
Maquiladora
factory owned by an MDC company but situated in an adjacent LDC, very close to the border between the two countries, offering a compromise between cheap labor and proximity to markets (e.g., factories near the US/Mexico border are the original maquiladoras); special economic zone on Mexico’s northern border with the United States
Market area
the area surrounding a central place, from which people are attracted to use the place’s goods and services (hinterland)
Marxist theory
theory of Karl Marx that says that society’s classes are the cause of struggle and that society should have no classes
Maternal mortality
the death of a woman while pregnant or within 42 days of termination of pregnancy, irrespective of the duration and site of the pregnancy, from any cause related to or aggravated by the pregnancy or its management but not from accidental or incidental causes (per 100,000 live births is maternal mortality rate)
MDC/developed country
(More Developed Country) a country that has progressed relatively far along a continuum of development
Microlending / microloan
small loans and other financial services to individuals and small businesses in developing countries; the extension of very small loans to impoverished borrowers who typically lack collateral, steady employment and a verifiable credit history; designed not only to support entrepreneurship and alleviate poverty, but also in many cases to empower women and uplift entire communities by extension
Monopoly
exclusive control of a commodity or service in a particular market, or a control that makes possible the manipulation of prices
Multiplier effect
an increase in spending that produces an increase in national income and consumption greater than the initial amount spent
Neocolonialism
control over developing countries exerted through indirect means, whether economic, political or even cultural power
Neoliberal
relating to or denoting a modified form of liberalism tending to favor free-market capitalism
New International Division of Labor
transfer of some types of jobs, especially those requiring low-paid less skilled workers, from more developed to less developed countries; spatial division of labor due to the transition of production from national to global (Global Division of Labor)
NICs
Newly Industrialized Countries; country whose level of economic development ranks it somewhere between developing and highly developed classifications; have moved away from an agriculture-based economy and into a more industrialized, urban economy
Nonbasic Industries
primarily small businesses (such as diners, service companies, small consulting companies and convenience stores) that sell to local customers
North-South Divide
socio-economic and political division that exists between the wealthy developed countries, known collectively as “the North,” and the poorer developing countries (least developed countries), or “the South”
Offshore financial services
Offshoring
practice of basing some of a company’s processes or services overseas to take advantage of lower costs
OPEC
intergovernmental organization of oil-producing countries that aims to coordinate and unify the petroleum policies of its member states
Open Shop
a place of work where employees are not required to join a labor union
Outsourcing
the business practice of hiring a party outside a company to perform services and create goods that traditionally were performed in-house by the company’s own employees and staff; usually done as a cost-cutting measure, it can affect jobs ranging from customer support to manufacturing to the back office
Periodic market
an authorized public gathering of buyers and sellers of commodities at an appointed place at regular intervals
Periphery
In World System Theory, periphery countries are less developed than semi-periphery and core countries. Usually receive a disproportionately small share of global wealth, have weak state institutions and are dependent on or exploited by more developed countries. Usually behind because of obstacles such as lack of technology, unstable government, and poor education and health systems.
PIGS
acronym for four of the most economically weak eurozone nations during the European debt crisis that started in 2008-2009: Portugal, Italy, Greece and Spain; the countries drew attention due to their weakened economic output and financial instability, which heightened doubts about the nations’ abilities to pay back bondholders and spurred fears that the nations would default on their debts
Post-Fordist Production
adoption by companies of flexible work rules, such as the allocation of workers to teams that perform a variety of tasks
Postindustrial
relating to an economy that no longer relies on heavy industry
PPP
Purchasing power parity (PPP) is an economic theory that compares different countries’ currencies through a “basket of goods” approach. According to this concept, two currencies are in equilibrium or at par when a basket of goods (taking into account the exchange rate) is priced the same in both countries. A measure of how many units of currency are needed in one country to buy the amount of goods and services that one unit of currency will buy in another country.
Productivity
the value of a particular product compared to the amount of labor needed to make it
Professional services
occupations in the tertiary sector of the economy requiring special training in the arts or sciences such as architects, accountants, and engineers
Public services
services offered by the government to provide security and protection for citizens and businesses
Research Triangle
commonly referred to as simply The Triangle; a region in the Piedmont of North Carolina in the United States, anchored by the three major research universities of North Carolina State University (Raleigh), Duke University (Durham), and University of North Carolina at Chapel Hill; home to numerous tech companies, enterprises, and businesses attracted by the universities, research facilities, and educated workforce
Right-to-work laws
guarantees that no person can be compelled, as a condition of employment, to join or not to join, nor to pay dues to a labor union
Rostow’s Stages of Economic Growth
All countries develop in a five-stage process; the development cycle is initiated by investment in a takeoff industry that allows the country to grow a comparative advantage, which sparks greater economic gain that eventually diffuses throughout the country’s economy. Drawbacks to this model include it not identifying cultural and historic differences in development trajectories because it is based on North American and western European development histories.
SDGs
otherwise known as the Global Goals; a universal call to action to end poverty, protect the planet and ensure that all people enjoy peace and prosperity; these 17 Goals build on the successes of the Millennium Development Goals, while including new areas such as climate change, economic inequality, innovation, sustainable consumption, peace and justice, among other priorities.
Primary SDG
extracting natural resources
Secondary SDG
manufacturing; processing natural resources
Tertiary SDG
providing services to people and businesses
Quaternary SDG
knowledge-based sector that includes research and development, business consulting, financial services, education, public administration, and software development
Quinary SDG
highest levels of decision-making; includes top officials in various levels of government and business
Self-Sufficiency Approach
countries encourage domestic production of goods, discourage foreign ownership of businesses and resources, and protect their businesses from international competition
Semi-periphery
In World System Theory, semi-periphery countries are industrializing, mostly capitalist countries which are positioned between the periphery and core countries. Semi-periphery countries have organizational characteristics of both core countries and periphery countries and are often geographically located between core and peripheral regions as well as between two or more competing core regions.
BPO
Business Process Outsourcing (BPO) is a subset of outsourcing that involves contracting the operations and responsibilities for a particular business process (usually back office services) to a third-party service provider
Brandt Line
visual depiction of the North-South divide based on GDP per capita, proposed by Willy Brandt in the 1980s, identifying the wealthiest countries in the world as the Global North and the poorest as the Global South; encircling the world at a latitude of 30° N, passing between North and Central America, north of Africa and India, but lowered towards the south to include Australia and New Zealand in the rich north.
Consumer goods
goods that are ready for consumption in satisfaction of human wants, as clothing or food, and are not utilized in any further production
Four Asian Dragons
The Four Asian Dragons, Four Asian Tigers or Four Little Dragons, are the economies of Hong Kong, Singapore, South Korea and Taiwan, which underwent rapid industrialization and maintained exceptionally high growth rates between the early 1960s and 1990s (first NICs)
GDP per capita
a measure of a country’s economic output that accounts for its number of people; divides country’s gross domestic product (the total value of all goods and services produced within a country during a given year) by total population
GNI per capita
divides country’s gross national income (monetary worth of what is produced within a country plus income received from investments outside the country and foreign residents) by total population
country’s gross national income divided by total population
Growth Pole
urban center where certain attributes, if augmented by investment support, will stimulate regional economic development in its hinterland
IMF
International Monetary Fund (IMF) is an international organization that aims to promote global economic growth and financial stability, encourage international trade, and reduce poverty
MDGs
The eight Millennium Development Goals (MDGs) are a declaration with the goal of improving the living conditions of people in the least developed countries. The goals were:
(1) eradicate extreme poverty and hunger,
(2) achieve universal primary education,
(3) promote gender equality and empower women,
(4) reduce child mortality,
(5) improve maternal health,
(6) combat HIV/AIDS, malaria, and other diseases,
(7) ensure environmental sustainability,
(8) develop a global partnership for development.
OECD
The Organization for Economic Cooperation and Development is a group of 34 member countries that discuss and develop economic and social policy; members are democratic countries that support free market economies and are among the wealthiest, most industrialized, most developed countries in the world (e.g., US, UK, Germany, Australia…)
Service
any activity that fulfills a human want or need and returns money to those who provide it
Silicon Valley
a nickname for the southern portion of the San Francisco Bay Area in California that is home to many of the world’s largest high-tech corporations, as well as thousands of tech startup companies
Special Economic Zone
area in which the business and trade laws are different from the rest of the country; SEZs are located within a country’s national borders, and their aims include increased trade balance, employment, increased investment, job creation and effective administration; companies may be offered tax holidays, where upon establishing themselves in a zone, they are granted a period of lower taxation; common in China
Standard of Living
the quality of life based on the possession of necessities and luxuries that make life easier
Steel minimill
steel production plants that rely on steel scrap as a base material rather than ore
Structural adjustment program
loans provided by the International Monetary Fund (IMF) and the World Bank to countries that experienced economic crises; require borrowing countries to implement certain policies in order to obtain new loans (or to lower interest rates on existing ones)
Student/teacher ratio
the number of students who attend a school or university divided by the number of teachers in the institution (e.g., a student–teacher ratio of 10:1 indicates there are 10 students for every one teacher)
Tariff
a tax imposed on imported goods and services
Textiles
a type of cloth or woven fabric
Tourism
the commercial organization and operation of vacations and visits to places of interest
TVA
(Tennessee Valley Authority) established in 1933 as one of President Roosevelt’s Depression-era New Deal programs, providing jobs and electricity to the rural Tennessee River Valley, an area that spans seven states in the South; envisioned as a federally-owned electric utility and regional economic development agency; still exists today as the nation’s largest public power provider
Utiliites
an organization supplying the community with electricity, gas, water, or sewage treatment
Welfare
aid in the form of money or necessities for those in need
World System Theory
Proposed by historian Immanuel Wallerstein, it is an approach to world history and social change that suggests there is a world economic system in which some countries benefit while others are exploited; characteristics include: a three-level hierarchy consisting of core, periphery, and semi-periphery area; core countries dominate and exploit the peripheral countries for labor and raw materials; peripheral countries are dependent on core countries for capital; semi-peripheral countries share characteristics of both core and peripheral countries
WTO
World Trade Organization (WTO) is an international institution that oversees the global trade rules between nations
