With Industrial workers playing a minute role within tightly controlled factories,
becoming divorced from the products of their labour.
2. Agglomeration economies
A set of advantages that for firms that are derived from the concentration of other
firms in the same location- EX. Availability of skilled labour, proximity to a large
number of customers.
3. Branch Plants
Undertaking basic production activities, but controlled from outside. In the 1960s-
1970s, corporate growth at national level and international level produced a new
special division of labour, displacing local ownership.
4. Brandt Line
the line divides the north (first world and second world) and the south (third
5. Bretton Woods Institutions
It’s the dominant mode of production today. It is based on private ownership of
the means of production. It is associated with need for most people to sell their
labor power to employers in order to earn a wage.
It is thhistorithlly specific mode of production. Roots in early modern Europe in
the 16 and 17 centuries.
First water-powered cotton spinning factory in England 1771
7. Capital Switching
Capital is moved between sectors of the economy and regions, in response to
changing investment opportunities. Capital is often transferred from regions with
declining sectors to “ new industrial spaces”.
8. Capital Accumulation
The process of investment in production to generate higher profits. It represents
the basic driving force for economic growth and innovation. 9. Circuit of capital
After generating a profit above the initial money outlay, part of this profit is
reinvested back into the production process, which recreates the circuit anew
and forms the basis of capital accumulation. Secondary and tertiary circuits are
also commonly identified, referring to investment in the built environment and
education, health, etc.
A political and economic system based on territorial empires, involving the direct
political control of colonies by the colonial power.
colonial powers retained huge economic and political influence, which allowed
them to keep exploiting resources and labour in a new guise.
The network of connections involved in the production, circulation and
consumption of a commodity. It has a distinct geography, linking together
different stages of economic activity carried out in different places.
12.Classical Political Economy
The study of the production and expansion of national economic wealth.
Emphasis on the study of markets as a mechanism for regulating an economy
and maximizing and distributing wealth for the public good
Associated with Adam Smith, David Ricardo
the basis of a commodity’s value depended on the human labour expended or
consumed in its production – a labour theory of value
(What is PE? The study of ownership and power and its influence over the
production, circulation and consumption of commodities and the production and
appropriation of value
PE makes connections between the economic, political and cultural/ideological
moments of social life in a holistic way . iT IS The study of the mechanisms at
work in socially- organized production aimed at the creation of wealth)
The dynamic advantage derived from the active creation of technology, human
skills, economies of scale, etc. it relates efficiency to pre-existing endowments of the main factors of the production. It helps to account for patterns of trade and
regional specialization at amore detailed level.
The withdrawal of investment from activities and places that yield low rates of
profit in order to reinvest them elsewhere. Uneven development is the spatial
consequences of creative destruction.
(Coined by Joseph Schumpeter to capture the dynamism of capitalism in terms
of innovation and the development of new technologies. As new products are
developed, they often render existing industries obsolete, unable to compete on
the basis of quality or price.)
The removal of more rewarding aspects of work, such as design, planning and
variation, often associated with an increase division of labor. The subdivision of
the labour process increase employers’ control of production, reducing workers
to minute roles and making them venerable to replacement by machines.
A decline in the importance of manufacturing industry, associated with the growth
of service industries and the closure of heavy industries, such as coal, steel.
Addresses questions about the location and distribution of economic activity, The
processes that create patterns of uneven geographical development. The
process of local, regional and national economic development.
Asks questions of:
– What? (type of economic activity)
– Where? (location)
– Why? (explanation)
– So what? (implications and consequences of particular arrangements and
18.Economies of Scale
The tendency for firms’ costs for each unit of output to fall when production is
carried out on a larger scale, reflecting greater efficiency. Industrialization led to
huge economies of scale through the establishment of factories, employing
machinery, and an elaborate division of labour.
19.Effective Demand Effective demand refers to the aggregate demand for the community at different levels of
employment.Effective demand is a representation of the actual amount of goods or
services that buyers are purchasing in a given market.
• Attack on the commons during the enclosure movement and the movement of
larger numbers of peasants to the city.
Enclosure Movement 18th century movement among wealthy British landed
aristocrats to rationalize their farms. Using new farming technology and systems
of crop rotation, they forced the agrarian poor off the old "village commons" that
now became "enclosed" as private property. The jobless poor ended up
constituting the working class in the upcoming Industrial Revolution.
21.Export Processing Zones
Production enclaves in part of the less developed countries set up by MNCs from
the developed countries to supply markets in advanced economies, with the
added incentive for foreign firms of offering tax and investment incentives to
Advantage examples: Lower local taxation, relaxation of the rules governing
22.Factors of production
combining land (resources), capital, labor and knowledge to make particular
goods and services
How Was Feudalism Organized in Western Europe?
Feudal systems depended on a system of production where surplus output
was appropriated by those higher up in the socio-political hierarchy through
tribute in the form of labour, product or military service.
In turn, peasants had access to common land and equipment to produce
Feudal systems depended on a mode of production where all surpluses (above
subsistence levels) were coercively appropriated by those higher up in the socio‐
political hierarchy through reciprocal obligation and tribute in the form of military
service or agricultural labor
24.Fictitious Commodity A product that takes on the appearance of a commodity, but cant be regarded as
a proper one. EX.land, labour, and money.
• A way of organizing an economy by ensuring that mass production is matched by
mass consumption at the level of the national economy
• Gets its name from the revolutionary manufacturing techniques perfected by
Henry Ford in the early 1910s • BUT Fordism encompasses much more than the
Fordist production process (assembly-line mass production system) – it also
refers to a set of demand management institutional practices that emerged from
the social and political institutional restructuring policies of the 1930s and 1940s
What made Ford’s Mass motor car production successful?
Manufacturing technology (production process): • system of interchangeable
parts• moving assembly line• Standardization and Simplification of the Product
Labor Force (labour process):
• Finding law abiding, docile workers (Earlier on the intensity of the work resulted
in increased labour turnover, absenteeism, and worker unrest)
• Control over labour – machines set the pace and speed of work
• Paying them more $5/day creating a new mass worker – unskilled but highly
• Attracted immigrant labour
• Managerial control :• scientific management techniques (FW Taylor) •
• the model of development in the core industrial economies of Europe and North
America during the 1940s, 1950s, and 1960s
• achieved balance between (mass) production and (mass) consumption
• economy regulated at the level of national economies
• produced several decades of sustained economic growth, capital accumulation
and significant improvement in the standard of living for working people.
• built on the institutional reforms of the 1930s and 40s - no preordained blueprint,
came out of a long period of institutional experimentation
• precise institutional form of Fordist regulation varied from country to country
(U.S., Canada, U.K. France, Germany, Sweden, etc) but shared some common
underlying principles: – Keynesian style demand management policies, – welfare
state provisions,– real wages linked to productivity growth,– Etc.
Textbook: A regime of accumulation. Based on mass production, mass consumption,
provided by rising wages for workers and increased productivity.
Henry Ford introduced the mass-production techniques.
27.Foreign Direct Investment
The increased connections and linkages between people and firms located in
different place, Flows of capital, labor, technologies that are creating more
intense, extensive and fast interconnections between people and places, such
that distant events, affect people and places more directly and immediately than
Key factors creating greater interactions between places?
• Neoliberalism– liberalization of trade and investment – Deregulation–
harmonization of institutions
• Global Corporations
• The movement of People
What is driving process of globalization?
Pursuit of profit and accumulation through the process of accumulation
Seek to increase productivity through the use of technology and technical division of
labour, combined and uneven development
Globalization is not just a set of uncontrollable processes out there, but rather, a
set of practices, policies and structures that is regulated and managed by a wide
array of institutions.
Gold standard ensured currency stability.A gold standard is a monetary
system in which the standard economic unit of account is based on a fixed
quantity of gold.
30.Gross Domestic Product (GDP) An estimated value of the total worth of a country’s production and services, within its
boundary, by its nationals and foreigners, calculated over the course on one year.
31.Gross National Product (GNP)
An estimated value of the total worth of production and services, by citizens of a country,
on its land or on foreign land, calculated over the course on