Industrialism
What century was the Industrial Revolution?
The 18th century
Least cost theory explains _______ and the three key variebles in this theory are ______, _______, and _______.
(bonus points for the name of the creator of this theory)
...the key decisions made by businesses about where to locate factories and the three key variables in this theory are transportation, labor, and agglomeration.
bonus question answer: Alfred Weber
The assembly line was an innovation that is accredited to _________.
(bonus points for the definition of an assembly line)
Henry Ford
bonus question answer: when an item moved from worker to worker, with each worker performing the same task repeatedly.
Where are maquiladoras most likely to be located?
On the US - Mexico border
What does GII stand for and what does it measure?
Gender Inequality Index; it measures the amount of gender disparity in a country.
(factors taken into account include reproductive health, empowerment, and labor market participation of women)
What were the first factories built adjacent to and why?
They were built next to sources of power and transportation routes since it was advantageous to have such useful resources nearby.
Which model is a dependency model in which countries don't exist in isolation but are part of an intertwined world system?
(hint: this model divides countries into core, semi-periphery, and periphery countries)
Wallerstein's World Systems Theory
What is the substitution principle?
When businesses seek to maximize profit by substituting one factor of production for another (ex: replacing workers with robots/machines)
What are the 3 types of outsourcing?
1. onshore: contracting work out to noncompany employees and companies in the same state
2. near shore: outsourcing in near, adjacent countries
3. offshore: outsourcing in a place that is far from the country of origin/HQ
What does HDI stand for? What is its purpose? What factors are taken into account?
(bonus points for the name of the person who developed this concept)
HDI stands for Human development index
Its purpose is to make a summary measure of average achievement in key dimensions of human development
Factors taken into account are education, life expectancy, and consumer goods.
(bonus question answer: Mahbub ul Haq)
What are some other terms used to describe bulk-reducing industries? Define this term as well.
(bonus question: what is the opposite of this term?)
Weight-losing industry, a raw-material oriented industry, or a raw-dependent industry.
In bulk-reducing industries, the final product is lighter than it was when its original form arrived.
bonus question answer: Bulk-gaining, or weight-gaining industry, or market-oriented industry, or a market dependent industry.
In Rostow’s economic development model, the stage in which workers become more skilled and modern technology spreads to industries beyond the innovating “takeoff” industry is called the
(A) traditional society
(B) preconditions for takeoff
(C) takeoff
(D) drive to maturity
(E) age of high mass consumption
D
(In the drive to maturity stage of Rostow’s model of economic growth, the innovation and growth that benefited the society’s takeoff industry spread to other areas of the economy, enabling workers to specialize and grow more skilled.)
Which of the following is an example of a quinary-sector economic activity?
(A) Working at a cash register at McDonald’s
(B) Serving as a researcher for human genetic cloning
(C) Serving on the U.S. president’s cabinet
(D) Converting crude oil into gasoline
(E) Plowing land in preparation for planting a crop
C
(the quinary sector includes the highest levels of decision making, such as top officials in the government and businesses)
Country X can produce televisions at 50 percent of the cost that Country Y can produce televisions. Country Y can produce pencils at 70 percent of the cost that Country X can produce pencils. Therefore, Country X chooses to produce televisions and trade them with Country Y for pencils. This scenario best reflects which concept?
(A) Substitution principle
(B) Topocide
(C) Foreign direct investment
(D) Footloose industry
(E) Comparative advantage
E
(Comparative advantage is the idea that a region (or country) will produce goods it can make at a lower cost than other regions can and will trade them for goods that other regions can make more efficiently than it can.)
What is the difference between GDP and GNP?
GDP measures the value of goods and services produced within a country's borders, by citizens and non-citizens alike. GNP measures the value of goods and services produced by only a country's citizens but both domestically and abroad.
What is multiplier effect?
What is reverse-multiplier effect?
Provide an example of each.
Multiplier effect: the ability of a job to produce additional jobs
Reverse-multiplier effect: when a job/company takes away jobs in an area
All of the following are criticisms of Rostow's stages of economic growth model EXCEPT:
(A) it is based on the US and Western Europe so it doesn't fit non-western and non-capitalist countries
(B) it exploits LDCs and can trap them in a dependent state
(C) not all countries are capable of reaching stage 5
(D) discourages the flourishing of cultures/ ignores cultural influence
(E) it moves in a linear way and thus isn't accurate
D
The informal sector in a developing country exists for all the following reasons EXCEPT:
(A) Tertiary economies in the formal sector are not developed well enough to absorb all the economies of the informal sector.
(B) The demand for informal-sector goods and services keeps prices low.
(C) Informal-sector workers and businesses cannot afford permanent business sites.
(D) The government benefits from taxing informal-sector workers and their small businesses.
(E) The quality of products and the quality of work in the informal sector are low.
D
(The informal sector consists of workers who do not report their incomes or jobs to the government. The government cannot tax informal-sector workers because it does not know officially of their work activities, and the informal sector is not included in GDP calculations.)
What is the dependency theory and who created it?
The dependency theory, which was created by Raul Prebisch in the 1950's, states that many countries are economically poor because of their colonization by European powers.
What does BRICS stand for?
What is/was its goal?
Does it still exist?
BRICS stands for Brazil, Russia, India, China, and South Africa.
Its goal was to move up the economic ladder and to promote peace, security, development and cooperation.
No, the alliance failed because the countries failed to work together. (Only Brazil, India, and China improved)
Who created the theory of profit maximization and what did this theory state?
August Losch created the theory of profit maximization, which argued that higher prices for transportation, labor, or raw materials were justifiable if they resulted in a higher profit.
Who came up with the concept of agglomeration economies?
What does it mean to be an agglomeration economy?
What are some pros/cons of being in one?
Alfred Marshall came up with this concept.
An agglomeration economy is when factories/industries clump together
Pros: shared market, less expenses
Cons: eventually, the costs of land and the amount of competition increases
What is post-fordist production?
What companies practice this?
Post-fordist production is when instead of workers having only one job, the workers all work as a team.
Companies such as Toyota and Volkswagen.
What are the old and new Asian tigers?
Old: South Korea, Japan, Taiwan, Singapore, Hong Kong
New: Indonesia, Malaysia, Bangladesh, Vietnam, the Philippines
What does IMF stand for and what is its goal?
IMF stands for international monetary funds.
It provides loans to countries experiencing balance of payment problems and tries to stabilize currencies and resolve any export/import issues.
The IMF's managing director is Kristalina Georgieva.