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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