Industry Key Issue 4 (11.4) Flashcards
(29 cards)
Define New International division of labor
Selective transfer of jobs to developing countries
Explantion of International division of labor
Transnational business want to cut labor cost to stay on the same efficeny level as everyone in the global market so they veiw the production process of their product and if they can be preformed by low skill workers in developing countries. So they send the job materials over there. That is saving them more money then paying high wages to workers!!
Define Outsourcing
Giving the Responsbilty of production to independent Suppliers (kinda sounds like sourcing outside people with production responsibility)
How does transnational corperations distribute production to low wage ?
Outsourcing
Major impact on the locations of manufactrng because they have to pay attention to production process to find the perfect location of a facotry
Define Vertical Intergration
When a company controls all the steps of a production process (opposite of Outsourcing)
EX. Car makers once made all the parts to the car now they outsouce so they parts come cheaper and better from a developing country
Why has manufacutring in Mexico Increased?
Trade aggreemnts have elminated most (US and Canada) barries to moving goods into mexico becuase its the closest low wage country near the US plus low labor cost and close to the US market
Example of Mexico’s Trades with the US and Canada
Nealy all motor vehicle production in north america has been located in mexico other then the US and Canada.
Define Maquiladoras
Plants in Mexico on the US and Mexico Border
What Happens At Maquiladoras?
Mexican Companies recieve tax breaks if they ship material from the US, assemble them in Maquiladoras in mexico and export them back
US and Canada are scared manufacturs will relocate to mexico and take advantage of the low wage workers there + the less stict laws on air pollution
The World’s future growth in Manufacturing expected to clusters in 5 countries known as what?
BRICS - Brazil Russia India China and South Africa
Why would the 5 Countries BRICS be the worlds dominant industrial bloc if they worked together?
China and India have the 2 largest labor forces and Russia and Brazil are rich in inputs (materials for manufacutring)
Production of Textiles is an Example of what type of Industry that usually requires less- skilled and low cost workers?
Labor Intensive Industry
What are the 3 important steps of textile and apparel Production?
- Spinning of fibers to make yarn
- Weaving or knitting of yarn into fabric
- Assembly of fabric into products
These steps global distribution are not idenical All 3 step are NOT equally labor intensive!!!
Step 1. of Textile and Apparael Production **Spinning **
- Fibers spun from natural or synthetic elements
- Prime Natural fiber is cotton
- Synthetics is 3/4 of world’s thread production
- done in low- wage countries
- China produces 1/4 and India produces 1/5 of the world’s cotton thread
Step 2. of Textile and Apparael Production **Weaving ** MECHANIZED
- labor contrubutes a high pecentsage of production cost
- Clusted in low-wage countries
- China and India are the dominent fabric producers (becuase low labor cost offsets shipping materials and products long distances)
Step 2. of Textile and Apparael Production **Weaving ** BY HAND!!!
- Woven together by hand on a Loom (Frame on which 2 sets of threads are placed at right angles to each other)
- 1 set of threads called a Warp (strung lenghwise)
- 2nd set of threads called the** Weft** (carried in a shuttle that is inserted over and under the wrap
Step 3. of Textile and Apparael Production Assembly
- Developed countries play a larger role in assembly than spinning and weaving (because consumers of assembled products are located in developed countries)
- most clothing is assembled in developing countries
- the cost of the clothes get marked up by the retailer
- workers in developing countries earn around 1% of the final to the consumer
Where are the largest flows of clothing exported?
East and South Asia to North America and Europe
What is a Steel
An alloy of iron this manufactfuuring by removing impurties in iron like oxygen and adding elements such as manganese
Steel production was a good examplde of a bulk reducing industry located near its inputs
What are the 2 changes in situation factors that have alterted the distribution of steel producers within the US and worldwide?
- Changes in the relative importance of the main inputs
- Increasing importance of proximity to markets
Explain how the shift of the worlds manufacturing to the new industrial regions can be seen clearly in steel production?
At first developed countries had the most steel production and developing had the lowest but a few years later the roles switched. Developed countries decreased in steel production and developing countries increased plus doublded its world steel production mainly becuase of China (also India & South Korea) China’s steel industry grew becuase of acces to prime imputs like iron ore and coal
- increased demand by growing industries in China that uses a lot of steel such as motor vehicles
What are the 2 principal inputs in Steel Production?
Iron Ore and Coal
Most Steel was produced at large intergrated mill complexes!
What was the Process of Steel Production?
- They processed iron ore
- Converted coal into coke
- Converted iron into steel
and Formed the steel into products like sheets, beams, and rods
Traditionally why did steelmaking cluster near their 2 key sources of raw materials?
Because of the need for large quanities of bulky, heavy iron ore and coal
