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Impact of Economic Change of Social Inequalities (Impacts of Economic…
Impact of Economic Change of Social Inequalities
Effects of Economic Change on Social Inequality
Players of Economic Change
Players are indvs./groups who influence/are influenced by processes of change
Public Players
National Gov. - departments + agencies for strategic planning
e.g. education, transp. links, environmental management
EU - transnational gov. that can influence change
e.g grants for infrastructure development
Local govs. - sim. responsibilities to national govs.
Planning + implementation at local scale
Govs. try to stimulate economic growth, sustain employment + create new jobs + improve environment
Private Players
Businesses range from TNCs to self-employed
Aim of businesses is to generate money + make a profit on their investment
Local communities
Concerned about immediate area
Economic change e.g employment
Social change e.g. new housing developments on outskirts
Environmental change e.g. redevelopment of brownfield sites
NGOs
Have a particular focus
National Trust - private org. with over 1 million members for conservation
Social Inequality
Differences in society = moral issues concerning inequalities
Quality of Life
Extent to which one's needs are met
Treatment of people
Access to services
Freedom of speech
Standard of Living
Ability to access goods + services
Indicators
Physical
Quality of housing, pollution levels, graffiti
Economic
Access to leisures services, employment rate, level of income
Political
Oppos. to participate in community life + influence decisions + voting in elections
Social
Incidence of crime, access to health facilities, % on state benefits
Income + wealth are sig. in determining SOL + QOL
Higher incomes = greater choice of housing, education + diet = better
SOL
Higher incomes may not always = improved
QOL
Longer works hours + commute, migration from family + friends
Deprivation
When social inequality = v. large differences between people
Poverty - low wages/unemployment
Poor living conds.
Poor accommodation, overcrowding
Ill-health
Stress + strain
Poor education
Old skills, lack of staff
Poor skills
Poor occupational skills
Poverty
And cycle beings again
7
factors of the
Index of Multiple Deprivation
Income
Employment
Health
Education
Crime
Access to housing + services
Living environment e.g. air quality
Spatial Patterns
Caused by interaction of several factors
Wealth
Ability to purchase goods + services
Low incomes = ill-health, lower educational attainment + poor access to services
Disposable income
Lack of formal education + low skill sets = major obstacle to income
Housing
Quality of accommodation
Smaller income of household = less choice of housing
Poor quality + overcrowding = ill-health
When demand of housing exceeds supply
LIDCs + EDCs - millions live in slum housing
Bc of rapid urbanisation, demand exceeds supply and authorities have a lack of resources to cope
ACs - affordability of housing
Health
Poor diet
Unhealthy lifestyles
Stress
Access to medical services
Uneven distribution of healthcare
Elderly have limited mobility = restricted access to GPs + primary healthcare
Rural areas have widely dispersed medical care = issue for homes w/o transp.
Education
Govs. invest in education to raise SOL + QOL
Illiteracy excludes people from accessing education + skills training = reduced employment opportunities
LIDCs - accessing basic education is an issue for rural regions
Access to Services
Most countries have inequalities between regions
Central regions - high wealth + investment = good access
Peripheral regions = limited access
Factors
No. of services
Ability to get to services e.g. transp. links + distance
Social + economic factors e.g. gender + income
Digital Divide
Quality of connection
Mobile phone tech. in EDCs + LIDCs is reducing inequalities
Growth in satellite tech. = no need for fixed copper cables
Solar-powered recharging equip.
Authorities can restrict access to internet services
Internet access in China + N Korea - severely controlled by gov.
Impacts of Economic Change
Globalisation
Increasing flows of ideas, goods, capital, services + people
Global shift
- relocation of m.f. on global scale
Global economy
Global shift in production of goods + services
Emergence of new production centres
Intensification of global competition
ACs
Negatives
Rising job experts = inevitable losers
Job losers are often unskilled workesr
Large gaps develop between skilled + unskilled workers
Employment gains from new efficiencies only occur in ind. countries can keep wages low
Job losses are concentrated in certain areas + inds. =
deindustrialisation
+ structural unemployment
Branch plants are v. vulnerable bc they are first to close in recessions = many jobs lost
Positives
Cheaper imports of all relatively labour-intensive products can keep costs of living low
Growth in LIDCs = demands for experts from ACs
Greater ind. efficiency = development of new tech. + attracts foreign investment
Loss of mining + m.f. inds = improved environmental quality
EDCs + LIDCs
Negatives
Won't decrease spatial inequality bc jobs are concentrated in urban areas
Disruptive social impacts e.g. TNCs exploit areas = sweatshops
Overdependence on a narrow economic base
Destabalisation of food supplies - people give-up on agriculture
Postives
High export-generated income = export-led growth = investment =
multiplier effect
Can trickle down to local areas w. new highly-paid jobs
Can reduce neg. trade balances
Exposure of new tech. improvement of skills + labour productivity
Employment growth in relatively labour-intensive m.f. spreads wealth = reduced
development gap
Booms + Recessions
Economic health is rarely static
Places experience booms + recessions differently bc types of economic activities are distributed evenly in a space
Kondratieff Cycle
Concludes that 5-year cycles of growth + decline have characterised the capitalist world since 1750
Cycles of growth + stagnation are linked with technologucal innovation with new ind. =
boom
Tech. becomes old = fewer oppos. for growth =
recession
Boom
- high sectoral growth;
Recession
- relatively slow growth
Waves arise from several interventions being advised at a similar time
These launch technological revolutions
This creates growth in ind./commercial sectors e.g. assembly line production = growth of economy
There are 6 long waves in modern society + capitalist economy - initiated by a specific technological revolution
Financial-agricultural revolution
Industrial revolution
Technical revolution
Scientific-technical revolution
Information + telecomms. revolution
Hypothetical wave of post-informational technological revolution
Technical innovation
is not evenly distributed
Centres of innovation benefit from above average economic growth -
core regions
Strong multiplier effect
Greater economic oppos. explains the higher SOL
Some places cannot support technological innovation when others can
Bc of role of education, gov. + social orgs. in encouraging/discouraging enterprise + change
Silicon Valley
Santa Clara Valley, San Jose
Home to many of the world's largest tech. corporations + thousands of start-up businesses
Standfrod Uni
Close links with much of research
Offers a regular supply of high-quality grads.
Availability of venture capital
Funds development of risky innovations
Nearly half of all venture capital in USA is spent in Silicon Valley
Cluster of law firms
Specialises in patent + copyright law
= diff. oppos.
Many of the production-line workers are not paid more than the state's minimum wage
Yet has the most millionaires + billionaires in relation to pop. of the region
M.f. of some computer components involves exposure of toxic chems. = health risks
Majority of these workers are female migrants from Latin America + Asia
Impacts of Social Inequality
Jembatan Besi
Background
Jakarta is capital of Indonesia
10 m people live in Jakarta
Wealthiest 10% of Indonesia control 30% of household income: poorest 10% have access to 3.4%
Distribution of income in Jakarta is similar
1/4 of Jakarta's pop. live in slums
Jembatan Besi
NW of city centre
Developed organically over past 40 years as Jakarta's pop. has grown
Hemmed-in on all sides by built-up areas + Ciliwung River
Pop. of 4000
Is one of Jakarta's most densely-pop. districts
Inhabitants include those who ahve lived there for generations as well as temp. migrant workers
Socio-Economic Conditions
Slums exist because demand for affordable housing greatly exceeds upply
Neither gov. nor private sector have resources to cope with increasing numbers of people wanting to live in Jakarta
People themselves don't have resources to afford more expensive formal housing
Avg. income is $4/day - not a reg. income for many
Employment
is insecure
Most people can only provide casual + unskilled labour
Much self-employment
Many families run their own small businesses
Requires little start-up capital + many run from home
Selling food + second-hand clothes
Jobs w. more formal employment still have little security
Sig. garment ind. + many small-scale producers operating in + around slum areas
Little protection for those employed in these small factories + high health + safety risks
Health
is a major concern
V. poor sanitation
Few homes have a toilet
Toilets are poorly built + run for profit by local businesses
Toilets flush out into open sewers in the street
No clean running water
GW supplies are available but polluted as JB is built on former waste grounds
High incidence of disease
Epiddemics of water-born diseases e.g. cholera + typhoid
Tropical climate = malaria + hepatitis A
Young + elderly at risk from dehydration bc of diarrhoea
High pollution levels
Kerosene for cooking
Emissions drifting over city
Poor diet
Mostly rice with little fresh protein, fruit or veg.
Education
Schools are poorly equipped
Children don't often complete formal education bc they are needed to earn money to support their families
Garment ind. is a major employment source for young women
Housing
JB is one of the most densely populated areas in Indonesia
Most homes have a relatively well-built ground floor with timber and brick
Increased pressure on space = increased storeys
Structure is more makeshift with height
Residents make use of whatever mats. they find - scrap wood+ metal are common
Overcrowding, kerosene + improved nature of electrical wiring (overloading) = fire risk
Narrow alleys + tall buildings = no direct sunlight
Electric lighting is by neon tubes + bare bulbs
Future
Likely to exist for some time still
Urban authorities are trying to make in-roads in the worst areas
But planning is difficult + non-existent in most slums
Jakarta Housing and Administrative Building Agency has identified 392 'community units' that are slum areas planned for improvement
Slum clearance to allow rebuilding = people relocating to other areas of slum = situation worsens there
Often strong sense of community in slums
Stark contrasts in inequality between Jakarta + JB
Northwood, California
Background
Irvine was developed as a fully-planned city
Began in 60s
Built on former Irvine Ranch
Classic edge city
Developed around a series of communities called 'villages', - Northwood is one of them
Community in N part of City of Irvine in Orange County
21,000 people live there
2000 households
1/3 of households are with children of school age
Socio-Economic Conditions
Residents are financially well-off
Median income is $86,500/year
Reasons to lvie there
Access to employment in Irvine
Uni of California, Irvine, is the city's largest employer
Many well-established hi-tech companies
Several TNCs are based there e.g. Mazda, Toshiba
Irvine offers support for start-up companies e.g. venture capital
Healthcare
is excellent
Even by AC standards
Air pollution is relatively low as NW is on edge of LA conurbation
Education
Schools are among the highest-achieving in USA
5 high schools
Several tertiary education facilities
68% of 25+ have first degrees
Crime
Overall crime rate is 70% lower than national average
Violent crime is 50 incidents per 100,000 - national average is over 300
Ethnicity
1/2 residents are white
Asians are 2nd largest group
Most from Vietnam
Housing
Single-family households live on relatively large lots
91% of households own their own homes
2/3 of which have lived there over 10 years
Average household size is 2.8 persons
Many of the streets lined with trees
Good wind breaks
The Future
Irvine generally features among the highest ranked cities in USA for:
Safety, management + 'best place to live'
Impacts of Economic Cycles: Detroit
Decline of Capitalism
Have top-down structures
Provides major shareholders + boards of directors with resources to reduce/remove the good working conditions won by unions
Moving production is a distinct capitalist strategy
= pop. decrease from 1.8 million in 50s to 700,000 today
Workers Co-operatives
If the auto-workers had transformed the companies in worker co-operatives, production would not have moved
Would have found alternatives to moving - possibly saved Detroit
Would have paid less in dividends to owners, + salaries to managers
Those savings = better competition with European + Japanese markets
A co-operative future
Workers would own + operate the companies
Would have encouraged them to improve technologies
Found alternatives to automobiles to retain jobs if automobile production could not secure priorities for worker co-operatives
History
1910s-20s
Ford invented assembly line production
Halved the time taken to build a car from 16 to 8 hours
Henry Ford set up factory in Detroit
Offered high wages + 5-day working week = increased workforce
Kick-started immigration from plantations in S states
Growing black pop. in largely white states
GM + Chrysler later setup in Detroit
1930s
Long struggles between union + automobile capitalists
Unions won
Auto-capitalists changed so that they offered good wages + working conditions
WW2
Decline in industry - esp. for automobiles
Factories were converted to produce military products
1950s-60s
Boom of motor ind.
AM-driven economic growth
= Detroit globally recognised for successful capitalist renewal after Great Depression + War (1929-45)
High wage AM jobs, with security + benefits
Cars for movies + moviestars
People wanted to buy into lifestyle of owning a car
Detroit became 4th largest state
Vibrant city with distinctive culture + sound
Shaped world's music
AMs shaped world's inds.
40 new suburbs built to house workers
= people could liver further from city
Old inner cities removed for new freeway to link uburbs to city center
Forced people to own cars
AM companies invested in this to help encourage more people to buy their cars
Riots
Whites fled to white-only suburbs
Created via zoning laws
Wealthier middle/upper-class
1970s-80s
1973 oil crisis
AM companies slow to recognise need for smaller, more economical cars
Competition from overseas car m.f. e.g. Japan
= increased cost of driving
Socio-Economic Impacts
Decrease in pop., jobs + services
Decrease in large part of its tax base
Schools, hospitals, transp. + infrastructure w/o funding - esp. in downtown areas
Cheap cocaine = crime + social issues - esp. in downtown areas
Transp. + infrastructure networks declined as they were w/o funding
Effect of capitalism
Turned success into the largest municipal bankruptcy in US history
Key players
Major shareholders
Boards of directors selected by the shareholders
They failed to compete with European + Japanese AM inds. - lost market share to them
Responded too slowly + inadequately to need for fuel-efficient technologies
Economic failure = movement of production out of Detroit for lower wages
Consequences
Undermined economic foundations of Detroit's economy
Destroyed chances for an enduring middle-class
1970s
Real wages stopped growing and haven't since
But workers' productivity was generating more profits for employers
Increasing consumer debt + overwork postponed impacts of real wages on consumption
1990s - Present
SUVs for middle-class whites living in suburbs
2006 - hosts Superbowl
Fail to avert decline
2007
Long crisis bc
Wages became stagnant
Exhaustion of further consumer borrowing capacity
Crisis = unemployment
Employers used rise in unemployment to attack job security + benefits
GM + Chrysler got federal bailouts
AM companies got wage reductions - via tiered wage sys.
= Detroit's wage-based economy couldn't recover
AM production + profits did recover
Bankruptcy
Ford + Chrysler became bankrupt
Foreclosure crisis in housing market
Global recessions + financial crisis
Urban farming movements + in-migration of whites to derelict areas
2013 - is first city to declare bankruptcy
$18 billion debt bc of mortgage crisis
= increased violence + segrgation
Residential areas abandoned
2009 - 29 schools closed
Detroit Worker's Project
Plans to drink-decommission areas w. low occupancy rates
Economic Structural Change
Processes
Immigration
Suburbanisation
White flight
Deindustrialisation
School closure
Urban farming
Major Players
AM companies:
Ford, Chrysler, GM
Workers' Union
Japanese + German AM companies
Gov. - federal + state
The state could have better handled the rights of the people e.g. encouraged diversification within economy
Michigan
Background
Lower peninsula has 2 metropolitan areas
Metro Detroit area, SE Michigan
Core area = Detroit Urban Area
Metro Grand Rapids, SW Michigan
Core area = Grand Rapids
First settled by Native American tribes
Colonised by French in 17th cent.
1762 - French defeat in French + Indian War = under British control
British defeat in American Revolutionary War = part of USA
19th Century
Fe + Cu discovered in upper peninsula
Fe = key component for steel - steel used for cats
Infrastructure developments = faster transp. of goods between the lakes
Large lock system built between them
Infrastructure based on mining, agriculture + logging
Imp. industries at that time
1899 - Ford built his first AM factory in Highland Park, Metro Detroit
20th Century
1900-1960 - AM assembly + parts m.f. dominated
Growth not unifrom
1930s - Great Depression
Affected Michigan more severely bc of its industrial base
Recovered post-WW2 when owning a car became the new "American dream"
1960s
Immigration of workers + segrgation laws = racial tensions
1967 riot
- 43 dead (33 black), 7000 arrests (6000 black)
Whites moved to 'white only' housing suburbs created using zoning laws
21 st Century
Ind. decline
Demands for cars manufactured in Michigan dropped
Increased:
Unemployment
Outmigration
Negative multiplier
Unemployment + outmigration = less tax collected = servcies + infrastructure suffered
Review
Detroit was wealthiest city in US - thrived on AM ind.
Decline was complicated by economic + racial problems = bankruptcy in 2013
Decline triggered when AM companoes moved factories overseas for cheaper labour
Those who could afford it left the city centre for suburbs -
white flight
= 60% decrease in pop.
Increased % of black people living there
Detroit Today
Background
Largest US city ever to file for bankruptcy
People wait 1hr before police respond to calls
1/3 ambulances in service after first quarter of 2013
80,000 abandoned buildings in city
Unemployment nearly doubled in 2000
Homicide at its highest in 40 years
Sherwood Forest
N Detroit, traditionla residential area
Stable area
Black middle-class
Near university, golf course + other strong neighbourhoods
800 brick houses
Good condition
8 unocupied
33 vacant
Woodbridge
Victorian homes
Increase in young professionals since housing incentives in 2011
Targeted by city orgs
Within walking dis. of downtown = good economic prospects
1200 properties
60 unoccupied - always decreasing
1/2 vacant
Brightmoor
NE corner of Detroit, mostly urban prairie
High homicide + crime rates
Urban agriculture + community groups
Artistic
Many abandoned buildings (mostly wooden bungalows) are painted = more attractive + strong community
5000 buildings
1500 unoccupied
300 fire damage
500 are illegal dumping sites
Diversification
Blight Buster's Projects 2014 - Detroit
Background
Community organisation - trying to regenerate thru community means
City officials expanded the programme
It attracted 65,000 volunteers ww
Claimed 120,000 volunteers + 660,000 hours to:
Paint 700 homes
Board-up + secure 400 abandoned buildings
Demolished 100 houses
Undertook 3,850 neighbourhood clean-ups
Motor City Java House = BB's volunteer HQ
Heartbeat of NW Detroit
Has invested $300,000 in facility improvements over past 12 years
Farm City Detroit
Began 2008 in partnership with Fertile Ground COllective
Aims to transform 10 'blighted' buildings into 'Farm City Detroit'
Phases 1 + 2 completed
Received $120,000 funding
Needs more donations to complete remainder of Phase 3
Effects
Employed 32 neighbourhood youths
Over 3000 volunteers
Sustainable environment
Safer passages free from dangreous abandoned buildings
Properties salvaged for recycling durign demolition
Inter-generation mentorships = stronger community
Artistic Village Detroit
Essential for establishing financial stability for BB
Aims to continure attracting more retailers, small businesses + residential tenants
Is a 6000 ft2 entertainment + shopping complex
5 commercial tenants
3 residential tenants
*2 750 ft2 office spaces
Restored the Old Redford neighbourhood
Now a thriving business hub
Created a downtown area there
Attracted + retained business e.g. The Old Redford Theatre + Sam's Shoe Repair + Motor City Java House
Michigan's State Policies
1999
$1 billion plan to fund a 'life sciences corridor'
Quaternary sector
2003
Widened science concept to 'technology tri-corridor'
Created 'Venture Michigan'
2008
AM companies pleading for federal rescue
2010
Elected former venture capitalist Rick Synder as governor
Scaled back on use of tax credits for economic incentives
2008 - 16
Michogan invested in broad tourism-based strategy: Pure Michigan
Rebranding Strategy
Effective in creating jobs in tourism sector
Pure Michigan
One of the most important players in driving economic change
Tourist strategy to attract visitors to all parts of the state
2008 - governor granted $45 million funding
State has continued to allocate substantial funds to Pure Michigan every year since 2008
2011 - $14.2m investment in advertisement campaign
Attracted 3.2 million out-of-state visitors that paid $70m in Michigan taxes
= further investment from state
Shows how the state has been able to
Generate pos. multiplier
Diversify its economy base away from m.f. to services
Increase potential to invest further via taxation
Advantages
Attracted more visitors
Raised profile of state as tourist destination
State now has approved car liscense plates + road signs
Pos. multiplier
Largely responsible for $2 billion increase in tourism spending in 2010
Detroit
Detroit's part is mostly focused around heritage tourism
Tours of former car plants
Henry Ford museum
250 acre site in Michigan is marketed via short videos
Makes an attraction out of its economic structure under the heading: 'Detroit's Come-Back Story'
As a city destination, Detroit has been rebranded to appeak to art + food lovers
Cultural + Environmental Change
Processes
Immigration
Suburbanisation
White Flight
Deindustrialisation
Regeneration/Rebranding
Outmigration
1950s
Big 3 car companies dominated employment structure in Detroit
Relatively high wages + 5-day working week
= mass
immigration
of black people from S states
Workers on assembly line were mostly black = increased
racial tension
1960s-70s
Increased popularity of
suburban
homes bc of:
Building of first freeways
Increased car ownership
Areas closer to factory were less favorable + many white families moved out of downtown Detroit -
white flight
= progressively white suburbia + black immigrant downtown area in city
1980-2010
Depopulation
Inner city decayed bc of
outmigration
Pop. decrease = services closed = limited public transp. network + school closure
Contraction of inner city pop. = dereliction
1960s riot
+ deployment of National Gaurd = further
white flight
Deindustrialisation
= recession in Detroit + services closed
Japanese + German m.fs specialised in smaller, more fuel-efficient cars
Drugs
Cocaine accessible to many inner city areas as quick way to make money
Attractive bc oppos. were decliing
= wave of drug-related crime + youth delinquency
Looting, graffiti, destruction of buildings via arson
Education
Schools environments deteriorated
Arts, music + PE programmes cut
Inner-city schools struggled to recruit good teachers
Students became demotivated to learn
Regeneration Projects
Community farms
Art projects
New job sectors created
Community gardens planted on 50,000 vacant lots