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Chapter 11 Manufacturing: Regional Patterns and Problems. Introduction The Importance of Manufacturing Regional Patterns and Processes Manufacturing Regions of the U.S. Regional Industrial Development Problems U.S. Patterns of Manufacturing World Manufacturing Patterns

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chapter 11 manufacturing regional patterns and problems
Chapter 11 Manufacturing: Regional Patterns and Problems
  • Introduction
  • The Importance of Manufacturing
  • Regional Patterns and Processes
  • Manufacturing Regions of the U.S.
  • Regional Industrial Development Problems
  • U.S. Patterns of Manufacturing
  • World Manufacturing Patterns
  • The Globalization of Production
the importance of manufacturing
The Importance of Manufacturing

The shift to services: ? Does this mean manufacturing is no longer a key sector in regional economies?

The rise of high-tech

Role of R&D and High-Tech in regional growth

Manufacturing’s rich regional linkages

slide5

Employment Trend - Technology Based Industries-

Washington State 1974-2000

300,000

250,000

200,000

150,000

Other Technology

Based Industries

100,000

50,000

Aerospace

-

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

relationship between regional growth rates and intensity of r d
Relationship Between Regional Growth Rates and Intensity of R&D

WA

Index of R&D Effort

Correlation: -.282, sig. .045

Index of Employment Growth 1990-2000

regional patterns and processes
Regional Patterns and Processes
  • Regional Cycle Theory – industrial districts
    • Youth, maturity, and old age
    • Youth: experimentation & rapid growth; market expansion, capital rushes in, competitive advantage
    • Maturity: the dominance of the district, development of branch plants, movement of expertise to other regions
    • Old age: cost advantages lost, new regions become cost-competitive, aging capital, eroding managerial capabilities & labor
regional patterns processes cont
Regional Patterns & Processes, Cont.
  • Manufacturing within the urban system
    • Large cities as magnets for manufacturing
    • Not mentioned: they are also centers of markets for market-oriented categories of industry (milk processing, bread baking, newspaper printing, ready-mix concrete)
  • Diffusion of Manufacturing
    • Driven by technological innovations, in market oriented industry, in resource-oriented industry
manufacturing regions of the united states
Manufacturing Regions of the United States
  • Figure 11.1: The American Manufacturing Belt (Rustbelt)
    • Bos-Wash: Megalopolis anchored by New York
    • Montreal-Toronto-Buffalo-Rochester
    • Pittsburg – Cleveland – Detroit
    • Chicago – Gary - Milwaukee
    • Minneapolis – St. Louis
  • Rise of the Sunbelt: Figure 11.2
slide12

rise of manufacturing outside the rustbelt
Rise of Manufacturing Outside the Rustbelt
  • Fueled by:
    • Multinationals entering U.S. markets (e.g. Japanese automobile manufacturers
    • Advent of flexible production systems
    • Demise of Fordist production systems in some sectors
    • Development of just-in-time production systems
slide14

Evidence of long-term reductions in capital tied up in inventories

due to better logistics in the product delivery system

the end of fordism the flexibility debate

The End of Fordism? The Flexibility Debate

Are we not only entering a new long-wave, where IT is the driving force, but also a new long-wave in which the basic structure of productive relations is in massive shift?

The Fordist paradigm - implicit in the oligoplistic model - but also linked to consumption and the regulation of society/consumption

a new regime of accumulation

A new regime of accumulation?

(1) The emergence of clusters of small firms, including co-ops

(2) Flexibility related to new machines

(3) Labor’s new position

- functional flexibility (multiskilling)

- numeric flexibility

- financial flexibility

- more part-time, flex time, telecommuting

(4) Changes in market place conditions

- mass markets break down

- rise of niche (craft) markets

emergence of flexible specialization

Emergence of Flexible Specialization

Fragmentation of the Fordist firm - vertical disintegration (shedding non-central functions; outsourcing) and Market fragmentation (niche)

Adoption of new technologies, especially those dependent upon computers and telecommunications (CAD/CAM/FMS)

Labor force adjustments

functional flexibility (multiskilling)

numeric flexibility (adjusting quantities by task)

financial flexibility (wage rate adjustment)

more part time, short-term, temporary work

flexible specialization new industrial spaces

Flexible specialization & new industrial spaces

Piore & Sabel - The Second Industrial Divide - craft-based districts in Italy, Germany, Denmark

Clusters of high tech industry - Silicon Valley; Route 128; Austin

Wooden boats in Pt. Townsend WA; Log homes in Bitterroot Valley MT

The movie industry

 Debates over aspects of the flexibility thesis

slide20

Flexible Specialization and Regional Industrial Agglomerations: The Case of the U.S. Motion Picture Industry

by Michael Storper & Susan Christopherson

Historically, an oligopoly of

theaters

studio production facilities

actors/production specialists

spatially clustered in Southern California

Vertical disintegration: 1950’s - 1970’s, with consequences in the 1980’s

productions by organization type
Productions by Organization Type

Number of

productions

per year

151 190 207 243 222

establishments in the entertainment industry 1968 1997
Establishments in the Entertainment Industry 1968-1997

1997

8916

6343

15259

1997 data from U.S. County Business Patterns; in the 1987

revision of the SIC code motion pictures was combined into

a single industry

the decreasing size per establishment
The Decreasing Size Per Establishment

Combined

Motion Pictures

and TV

structural trends

Structural Trends

Retention of core activities: TV & Major films & channels of distribution

Forced divestiture of theater chains

Development of generic specialists subcontracting with specific producers for a given film & narrow scope; linked to major studios; many part-time workers; “project orientation,” FLEXIBILITY

Product diversification: TV, Video, Film

Establishments clustered in California, while filming locations have dispersed

manufacturing regions of the united states continued
Manufacturing Regions of the United States, continued
  • Location of Corporate Headquarters (Figure 11.4 – Borchert)
  • Government Influence on Regional Manufacturing Patterns
    • Rise of the “Gunbelt”
    • Regional Development Programs to Alleviate Poverty (ARDC; EDA
    • State government programs
    • Current fad: cluster studies