Economy and geography Economy, space and time A) Economic spatial theories B) Growth and development theories Economy and ecology Globalization as a consequence of technological change Summary and discussion
Economic Geography 1
Economy and geography
What is “economy”?
= house, household Provisions for the house Related to goods, objects (especially material) Cycle of materials (from raw materials to a finished product) Profit
Elements of definitions
Production and distribution of goods Production in order to satisfy a demand Balancing the demand for goods with the supply from a limited stock of resources Produce for one„s own needs (subsistence) Produce for the needs of others (surplus)
What is “geography“
science Structures and processes SPACE and TIME
Economic geography is ...
… a geography of man's struggle to make a living. As such it should concern itself with the production, use and reproduction of the social and material conditions of man's existence. In fact economic geography is firmly asocial. Emphasis has traditionally been placed upon the production and the use of the environmental and man-made material conditions of existence. (Lee, Dict. Human Geography)
Where do we place economic geography ?
Environmental science Economics
Social sciences, humanities
Work – work?
with the economy
Remunerated? Pleasure A
A typology of work
Free time Work
„Grey‟ economy Illegal activities Legal activities
Views of the economy
profit, shareholder value Entrepreneur: a challenge Employee: a job, a salary Citizen: almighty power Politician: source of income and influence Geographer ? see next
A modern view of the economy
complex system Human activities, based on rational and irrational decisions Limited predictability Embedded in the natural environment Part of the social environment Directed by changing perceptions
The future economy in a twofold dilemma
The future economy and sustainable development
• Sustainable development means to guarantee that future generations can continue to live on this earth. • This implies that we take care of the basic requirements of the ecosystem (the basis for all human existence on the planet). • Which way leads to an economy that has the potential to guarantee the survival of mankind over a long period? • Can technology alone achieve this goal?
The 3 economic sectors
Classification of the economic activities: Primary sector: preparing the raw materials Secondary sector: transforming the raw materials into manufactured products Tertiary sector: ensuring the functioning of the economy
The dynamics of the three sectors (Fourastié model)
Characteristics of the sectors
sector: agriculture, forestry, hunting, gathering, fishing, mining Secondary sector: manufacturing, construction work Tertiary sector: „all the rest‟ – but in a highly differentiated way
The tertiary sector
present, but in 20th century growth in importance and differentiation Comprises a variety of activities that demand different skills, are of unequal importance for various human groups and has both a public and a private side Can be classed according to a choice of perspectives
Possible definitions of the tertiary sector (A. Bailly)
Public, non competitive
Archaic/traditional Common Production-oriented Management
Modern Rare Consumer-oriented Service
T-sector is more complex than the P- and the S-sectors as it finds itself in a mediating position: both P and S require services We use all forms of the T-sector, but at different times and with varying frequencies
self-explaining Archaic/modern: bound to history (preindustrial vs. post-industrial) Common/rare: self-explaining Production/consumer-oriented: services for firms vs. services for households Management/service: self-explaining; service = executing, not directing
Dimensions of the T-sector
The Bailly classification shows the breadth of the service domain Traditional classifications use six groups of activities: administration, trade, finances, education, communication, health They have to be confronted with the entire breadth to show a clear picture of this field This yields 60 combinations – clearly too much for a simple classification!
Pub Pri ADM TRA FIN EDU COM HEA Arc Mod Com Rar Pro Con Man Ser
that are legal as such but not bound to formal places and installations (street vendors, street musicians) They offer a service close to the passerby who is a potential customer (e.g. the hairdresser or the dentist on the roadside in India)
Illegal („black‟) economy
Activities that are forbidden by law (drug dealing) Activities that are legal as such but are exercised under specific conditions: - illegal workers (low salaries, no social security, exploitation) - Saturday and Sunday work for friends that are not declared (no taxes and social security premium paid) Such activities are pursued by the state
The clandestine economy
Being an „underground„ field, there are no official figures on its share of the GDI Estimates (1980s): - US 13-14 % - Italy 10-25 % - England 7-8 % - Switzerland 3-5 % Figures are subject to change according to knowledge and investigation