Impacts of economic change on people and places?

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Positive impacts of economic change on ACs

  • Cheaper imports of all relatively labour-intensive products can keep cost of living down and lead to a buoyant retailing sector.
  • Growth in LIDCs may lead to a demand for exports from ACs.
  • Promotion of labour market flexibility and efficiency, greater worker mobility to area with relative scarcities of labour should be good for the country.
  • Greater efficiency apparent in surviving outlets. This can release labour for other higher productivity sectors (assuming low unemployment).
  • Greater industrial efficiency should lead to development of new technologies, promotion of entrepreneurship and should attract foreign investment.
  • Loss of mining and manufacturing industries can lead to improved environmental quality.
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Negative impacts of economic change on ACs

  • Employment gains from new efficiencies will only occur if industrialised countries can keep their wage demands down.
  • Job losses are invariably concentrated in certain areas and certain industries. This can lead to deindustrialisation and structural unemployment in certain regions.
  • Branch plants are particularly vulnerable as in times of economic recession they are the first to close, often with large numbers of job losses.
  • Rising job exports leads to inevitable job losses. Competition-driven changes in technology add to this.
  • Job losses are often of unskilled workers.
  • Big gaps develop between skilled and unskilled workers who may experience extreme redeployment differences.
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Positive impacts of economic change on EDCs and LI

  • Higher export-generated income promotes export-led growth - thus promotes investment in productive capacity. Potentially lead to multiplier effect on national economy.
  • Employment growth in relatively labour-intensive manufacturing spreads wealth, and does redress global injustice (development gap).
  • Can trickle down to local areas with many new highly paid jobs.
  • Can lead to exposure to new technology, improvement of skills and labour productivity.
  • Can reduce negative trade balances.
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Negative impacts of economic change on EDCs and LI

  • Unlikely to decrease inequality - as jobs tend to be concentrated in core region of urban areas. May promote in-migration.
  • Can destabilise food supplies as people give up agriculture.
  • Environmental issue associated with over-rapid industrialisation.
  • Disruptive social impacts e.g. role of TNCs potentially exploitative and may lead to sweatshops.
  • Health and safety issues because of tax legislation.
  • Can lead to overdependence on a narrow economic base.
  • Branch plants may move in on LIDCs too, leading to instability. (Bad for the EDCs they come from, good for the LIDCs they're going to.)
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