Economic Development

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TNC effects on LEDCs


  • Bring jobs and new technology to LEDCs
  • They connect different countries together
  • TNC factories are in better conditions than LEDC factories
  • Wages help the economy of LEDCs


  • Low wages
  • TNCs move profits to LEDCs to avoid paying taxes
  • TNCs create competition for small local businesses
  • TNCs do as they please so get better deals and leave
  • TNCs pollute air and water with chemicals
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  • Better technology- people can communicate with people half way across the world using phone, instant message, fax ect.
  • People sharing knowledge- a new idea springs to life and other countries use it to their benefit.
  • Transport - People can take a plane half way around the world. People can get out more.
  • TNCs and NGOs- provide help to people in other countries or provide jobs for local people.

Image result for aeroplane                            

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Employment structure

Primary sector - Jobs that include collecting RAW MATERIALS.

Secondary sector - Involves MANUFACTRURING. This means making products.

Tertiary sector - Involves proving a SERVICE.

Quaternary sector - This is HIGH TECH which requires skilled workers.

MEDC: Has lots of tertiary jobs and even has quaternary indusrties. Secondary and primary sectors are small. Products are imported from LEDCs.

LEDCs: High primary industries and small secondary industries. They don't have quaternary industries and have a medium sized tertiary industry.

NICs: Growing secondary industries.

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Palm Oil Production-Primary case study

Palm Oil is produced in Malaysia.

Location Factors:

  • Asia is a humid, tropical environment with temperatures between 25-28 degrees celcius all year round. Sunshine allows palm tree growth.
  • There is lots of rainfall at 2000-4000mm per year. Great conditions for palm trees.
  • There is lots of available land in Malaysia to set up palm oil plantations and rainforest can be cut down if need be.
  • Malaysia has lots of local and migrant farm workers (from Indonesia) to work the land for low pay. It's hard work!

YAY!!!- Money for migrant workers improves their quality of life. Money is made from exports.

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Dyson Factories-Secondary case study

Dyson factories are located at Port Klong Free Zone in South West Malaysia in the South East of the Capital Kuala Lumpur. Free zones are areas of free trade so exclude taxes on imports and exports. They used to be in Malmesbury-UK.

When factories moved to Malaysia, the:

Effects in Malmesbury were:Advatages: Local shops have more employees as there is o competion from the factories.Disadvantages: Council loses land fees and council tax from the factory.

Effects in Malaysia were:Advantages: Offers local people jobs improving quality of life. Factory is closer to it's supplier. There are no taxes in a free zone-cheaper. It may attract similar factories-multiplier effect.Disadvantages: Loss of greenfield that the factory is built on and animal habitats. More pollution from workers' cars.

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EE Call Centres-Tertiary case study

EE call centres are located in Cobalt business park located in the East of Newcastle in an area named Tyne and Wear.

Location Factors:

In North East England: People will work for a lower wage so it costs less to employ workers. People have flexible working hours so the call centre can be open longer. People are off less due to sickness than in London so expensive workers don't need to be called in often.

In Tyne and Wear: Houses are cheaper in the area so more people choose to live there meaning there are lots of workers available. The area has an urban metro so people can get to the park easily so people will want to work there.

In Cobalt Business park: Has attractive landscaping and a leisure centre to attract workers due to nice scenery and the chance to be active and healthy. Has a day nursey to care for workers' young children. Has a hotel for overnight stays for a business meeting the next day perhaps.

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Cyberjaya-a quaternary case study

Cyberjaya (a high-tech city) is in Malaysia to the South of the Capital, Kuala Lumpur, and North of the international airport.

Factors of location:

  • Housing- a large range of housing offers quaternary workers a nice home to live in. These are big and expesive. Affordable housing is available for tertiary workers who are needed in shops and as cleaners.
  • Transport links- There are major highways like the North-South expressway and main roads. These allow some workers to live in nearby towns and travel to Cyberjaya if they can't afford housing in the city. The airport is close so busiess partners can come from abroad.
  • Employment oppurtunities- highly skilled jobs for university students available as well as lower skilled jobs as shop assistants and cleaners. This decreases unemployment in the area and improves peoples' quality of life.
  • Similar high-tech businesses share ideas- multiplier induced by this. Quaternary industries in Cyberjaya can develop together.
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How industry ca impact the environment

Palm oil production may grow an economy and benefit local people by setting up transport links and bringing services like schools and hospitals to the area but there are some bad impacts on the environment.

98% of lowland rainforest in the region will be gone by 2022.

Rapid deforestation to create plantation land destroys animals habitats like the Orang-utan habitat.

Carbon Dioxide from slash and burn fires contributes to climate change.

Tribal groups in the rainforest are forced from their homes due to deforestation.

Other environmental effects of industry: Loss of Greenfield sites (EE call centres), Oil leaks from transport of goods/oil, air pollution and water pollution (of local rivers affecting the local water supply)

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Enhanced Greehouse effect

The enhanced greenhouse effect is when human activity adds to the rate of the greenhouse effect.

How it works:

  • Solar radiation passes through the Earth's atmosphere and the Earth's surface absorbs some radiation making it warmer whilst reflecting some back into space. Infrared radiation is sent back into the Earth's atmosphere and some is absorbed by greenhouse gases warming the atmosphere while the rest is sent back into space.

Our impact:

  • TRAVEL-We burn fossil fuels increasing greehouse gases in the atmosphere.
  • DEFORESTATION-We cut trees to clear space for farming or cattle meaning there are less trees using Carbo dioxide for growth leaving excess amounts in the atmosphere.
  • EATING MEAT-Cows produce methane so the more cows we have, the more greenhouse gases are produced.
  • INDUSTRIES-Fossil fuels burned means more greenhouse gases.
  • GROWING POPULATION-More of the above take place to give us more space and resources-loads of greenhouse gases!
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Effects Of Global Warming

Global warming- average increase in temperatures around the world over the last century.


  • Sea levels rise due to thermal expansion (water molecules near the surface expand due to rising temperatures).
  • Growth of the tropical belt means more of the world has tropical climates affecting agriculture and putting people at risk of tropical diseases.
  • The impact on wildlife is that species may be wiped out due to the inability to adapt quickly to changes in their environment.
  • Changing rainfall patterns means the amount and distribution will change in much of the world. Areas that recieve lots of rainfall may get more and areas that suffer from little rainfall may recieve less leading to flooding and drought as well as an increase in tropical storms.
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Solutions to climate change in Industry

Primary can plant more trees as they cut them down (afforestation) so carbon dioxide is removed from the atmosphere. By 2030, farmers can improve crops yields so fewer crops are needed to produce the same amount-less space needed.

Secondary can cotrol the amount of emission they create to reduce greenhouse gases and can reuse energy (heat and power recovery) instead of burning more fossil fuels.

Tertiary can use improved energy that is more efficient. They can also result to renewable energy that doesn't relese greenhouse gases.

Quaternary can use renewable energy or nuclear power as neither produce greenhose gases.

All industries can use higher fuel energy or biofuels to reduce carbon emissions in transport and people can use public transport.

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Reducing Global warming

Palm Oil production in Malaysia helps by:

  • Afforestation-plant new trees.
  • Use farm waste as biofuel-renewable energy
  • Maintain farm vehicles to make them more energy efficient.

Use Renewable energy:

  • Hydroelectricity- made from water that spins a turbine powering a generator generating electricity.
  • Wind Energy- wind spins a tubine powering a generator generating electricity.
  • Solar Panels(and in homes)- heat from the sun warms water turning it into steam which powers a generator generating electricity.

Use nuclear energy that generates heat powering a generator and doesn't release greenghose gases.

Energy efficient buildings are well insulated(cavity wall insulation and loft insulation. They have energy saving bulbs-more efficient and some have solar panels. 

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Industry location factors

  • Labour- This is the workforce. Workers are in towns and cities but indstries need different workers like quaternary industries need highly skilled workers so may be near universities.
  • Markets- This is being close to places where people buty a product or use a service. Selling can be done faster and cheaper as transport costs and distances are decreased.
  • Transport- Road/Rail transport allows products to be transported across the country. Being located near an airport or port allows for plane/boat transport of goods to other countries.
  • Preferred place of the owner- Some people set up in a place they like or came from.
  • Government/EU policy- The government may give grants to encourage industries to move to locations with high unemployment.
  • Services- Electricity, water supply, sewage treatment, telephone and internet access are needed by industries. They move where they can get it.
  • Resource materials- Factories may be near where their parts are made to reduce transport costs and carbon emissions.
  • Capital- A company may need money to get started which they may borrow privately or from a bank. The lender might suggest a suitable set up location.
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Quality of life

Quality of life: All the factors that affect one's general well-being and happiness.

Economic: Income- Having moneymeans being able to afford housing, food and education. Everything that creates stability.

Physical: Having good health lets a person be happy. Clean water and good food reduces malnutrition and the risk of diseases like cholera. The environment affects agriculture and the ability to grow food plus you don't always want an annoying tropical storm outside yor front door!

Social: Having family and friends to defeat loneliness. Education and health help people to be social and avoid becomming socially isolated.

Psychological: Feeling happy and secure with a sense of freedom helps people to have a good quality of life.

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Developing LEDCs and sustainability

An LEDC can develop:

  • a well and pump is supplied to bring clean water allowing better health.
  • Investment in machinery and fertiliser allows for successful crops so people can feed themselves and not be malnourished.
  • Electricity comes to rural areas leading to more use of electricity and development of technology.
  • Roads and railways will improve transport allowing people to travel and see family or get to work.

Sustainable development means meeting the needs of the present without resricting resources available to future generations. Mistakes of the past help us to develop more sustainably. Environmental impact assessments look at the impacts of a project on future generations as well as on the present.

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Measuring Development

You cannot always say that  a country is developed if it has lots of money.

The GNP will be part of development measure along with energy per person, primary employment and trade because they are all money related factors.

Developed countries have low birth rates, death rates and infant mortality rates due to their health care system and equality in gender. They also have good education systems so have a high literacy rate.

Human Development Index- A measure of quality of life taking into account GDP, literacy rates and life expectancy. They indicate the quality of the education and health care systems rather than focusing solely on wealth.

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Types Of Aid

Short term- Offers immediate help to help with immediate problems like natural disasters.

Long term- Teaches people how to help themselves and is more about planning and prevention.

Aid can be give in the form of grants(money lending), goods/food/machinery/technology or skilled workers like teachers.

  • Government (bilateral)- Giving aid from one country to another via government.
  • International Organisations (multilateral)- aid given from organisations like the World Health Organisation.
  • Voluntary- These are NGOs (non-governmental organisations) like oxfam and comic relief. They collect donations. Not funded by Government.
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Aid-Disadvantages/Advantages and Improvements

Tied: The country recieving aids must buy goods from the donor country.

Government- It provides grants for some students to study in MEDCs which improves education. It funds some specific projects that don't benefit people. LEDCs rely heavily on MEDC aid putting them in debt. It is tied.

International Organisations- It encourages farming industries so LEDCs create raw materials and crops helping them develop. It isn't often given to countries with disliked economic/political systems. LEDCs depend heavily and face debt.

Voluntary- Not tied. Helps in emergencies. Benefits the poor. Dependant on the support and donations from people in MEDCs.

Improvement: MEDCs need to make aid more effective by giving it to those most in need. Debt in poor countries should be cancelled. Encourage LEDCs to develop sound economic systems. Focus on long-term aid reducing the need for aid and so the chance of debt.

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Factors affecting development

Economic- Poor trade links means that you trade with few countries meaning less money comes in for development. Debt means money made is always being made to pay back and not to develop. Too much hope in primary products won't help because you don't make much selling them and prices fluctuate meaning there is sometimes no profit so there is no money to develop.

Social- Poor drinking water means people get ill and can't work so there is less money to fuel the economy. If women don't work, less people are working overall which limits the amount of money that can be used to develop the country. The more children who get an education, the better the jobs they can have directly developing the country and making more money for development.

Environmental- If there is a poor climate that is too hot or cold, poor farming land and limited water supply, food can't be grown and so people will become malnourished so they won't be able to work and make money. There will be nothing to sell so no money will be made. Too many natural hazards means money is spent on dealing with the damage rather than on development. If a country has too few raw materials, they have nothing to sell and can therefore make no profit to fund development.

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good resource to use



Extremely useful!

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