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Economic Activity And The Environment

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This is based on the externalities of business and the growth of different secotrs of the economy and its effets on the environment as part of A2 Economic Geography

This is based on the externalities of business and the growth of different secotrs of the economy and its effets on the environment as part of A2 Economic Geography

Published in Economy & Finance , Technology
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  • 1. Economic Activity and the Environment
  • 2. Externalities
    • What are externalities?
    • What are the associated costs?
  • 3. Externalities
    • defined as third party (or spill-over) effects arising from the production and/or consumption of goods and services for which no appropriate compensation is paid. 
    • Externalities can cause market failure if the price mechanism does not take into account the full social costs and social benefits of production and consumption.
  • 4. Social costs?
  • 5. Social costs
    • includes all the costs of production of the output of a particular good or service. We include the third party (external) costs arising, for example, from pollution of the atmosphere.
  • 6. Private Costs
    • What are Private costs?
  • 7. Private Costs
    • A cost incurred in the production process by the producer; including tax and profit margins that are anticipated
    • Externalities create a divergence between the private and social costs of production .
  • 8. SOCIAL COST = PRIVATE COST + EXTERNALITY
  • 9. What is Cost Benefit Analysis?
  • 10. Cost benefit analysis finds all the positive factors known as ‘ benefits’ . And subtracts all the negatives, ‘ costs’ . The difference indicates whether the planned action is advisable.
  • 11. In Pairs
    • Come up with an example where social costs outweigh private costs
    • Where Private costs outweigh social costs
  • 12. Race and The Environment
    • The Center for Policy Alternatives (CPA) in the USA released a study in 1987;Toxic Wastes and Race Revisited which revealed that commercial toxic waste facilities are even more likely to be located in minority communities than ever before
    • It found that people of colour are nearly 50 percent more likely to live near a commercial toxic waste facility than whites
    • And three times more likely to live in communities with multiple toxic waste facilities.
    • from 1980 to 1993, the concentration of minorities in zip code areas with commercial toxic waste facilities grew from 25 to 31 percent
  • 13.
    • Environmental racism, which suggests a higher level of exposure to environmental hazards for racial minorities and the poor than to non-minorities and those more economically advantaged,
  • 14.
    • According to the journal ‘Environment’ (May ‘94) The argument that unequal environmental protection undermined 3 basic equalities.
    • Procedural Equality
    • Geographical Equality
    • Social Equality
    • Ironically finding that some Government actions have increased the problems due to stringent regulations and least line of resistance
  • 15. So what do we know?
    • Externalities are costs to a third party
    • Social costs are all cost plus externalities
    • Private costs are the costs incurred by the producers
    • Cost benefit analysis is a method of working out the costs in terms of benefits and loses.
    • Race and the environment is a major issue
    • Inequality exists within this.
  • 16. The Service Sector
  • 17.
    • By far the most dominant sector in MEDC’s
    • Is of considerable significance in Developing countries
    • Clark Fisher model shows this.
  • 18. Osaka – Japan
    • Dubbed the second city of Japan
    • Osaka is historically the commercial capital of Japan
    • It’s the heart of Japan's second largest, and the world's ninth largest metropolitan area
    • Population of 19,220,000.
  • 19. Composition of Industry
  • 20. Classification of Service Industries
    • Service industries vary hugely from
    • Most importantly between producers and consumers
    • In pairs try to classify service industries into groups
  • 21. Variety Of Service Industries
    • Has changed due to:
    • Adaptation of new technologies
    • Increase in disposable income
    • Greater leisure time
    • Demographic changes
    • New social values
    • Service provision and location
    • Distribution and density of population
    • Variations in purchasing power
    • Availability of Labour
    • Proximity to other services
    • Demographic factors
  • 22. Retailing
    • What is retailing???
  • 23. Retailing
    • Consists of those business activities involved in the sale of goods and services to consumers for their personal, family or household use.
  • 24. Retailing
    • In Pairs try and think what kind of changes retailing has gone through and how it has changed the organisation and make up of retail industry.
  • 25. Recent Trends
    • Number of independent traders has fallen
    • Big retailers have gone transnational
    • Teleshopping
  • 26. Growth of Retailing
  • 27. Problems with Superstores
    • Taking customers away from rural shops
    • Often build on Greenfield sites
    • Huge parking areas and generate lots of traffic
  • 28. Finally...
    • Try to find out more about the classification of industries
    • Explain the attraction of London for financial institutions
    • What are the reasons for the decentralisation of back office functions.
    • Why has service provision declined within rural areas.
  • 29. Further Reading
    • Guinness and Nagle Chapter 4
    • http://tutor2u.net/economics/content/topics/externalities/what_are_externalities.htm
    • Geography an Integrated Approach Chapters 19 & 20
    • http://www.ft.com/cms/s/0/c729f3f6-d65b-11dc-b9f4-0000779fd2ac.html?nclick_check=1
    • Moodle