Geography Reference
In-Depth Information
CORES AND PERIPHERIES
Established core-periphery relationships have global
impacts. Multinational corporations and capital invest-
ment by the United States, European Union countries,
and Japan place recipient states in a position of depend-
ency . These countries are now joined by South Korea
and, most notably , China in terms of global investment.
As part of its “going-out policy ,” China has spent an esti-
mated US$115 billion on foreign acquisitions in the past
decade. (Learn more about China' s involvement in Africa
and elsewhere in Chapter 12.)
Movement of labor-intensive manufacturing activi-
ties to peripheral locations to take advantage of cheap
labor has been a hallmark of economic restructuring in
the late twentieth century , often with unfavorable conse-
quences. An assembly line might provide hundreds of
low-wage jobs, but a downsizing or relocation decision
in the core country can create instant joblessness. Many
foreign firms in Asia are criticized for their exploitation
of labor and resources and their cavalier attitudes con-
cerning environmental quality .
The debatable concept of dependency has given
rise to dependency theory . Dependency theory claims
that cores can only grow through exploitation of their
dependent peripheries. In order for cores to prosper,
spatial imbalances must be maintained. And, to under-
stand a region' s low level of development, it must be
viewed in context of both local and global core-
periphery relationships. From this perspective, trade is
not mutually beneficial.
People in the periphery compete to work for very
low wages, which drives down the price of goods. How-
ever, price reductions are not passed on to the consumer
because producers in the core have a common desire to
keep prices high. As cores and peripheries become in-
creasingly integrated on international scales, regional
economies are structured into situations of dependency
on the demands of the cores and are unable to develop
their own economies. However, geographies are con-
stantly changing.
In global cores, financial, investment, and assistance
rationales and applications are in question. In peripheries,
economic independence and local development progress
have become paramount concerns. Non-governmental
organizations (NGOs) and private concerns have taken on
stronger roles in development. Such changes mean that
dependency relationships are constantly shifting and
increasingly complex.
but not the rich one. Somewhere in the past cou-
ple of years, this developing middle class became
the majority of the developing world' s population.
The term “middle class” covers a multitude of
differences. A recent study of China' s middle class
by Kellee Tsai, a professor at Johns Hopkins
University , reveals that two-fifths of private-sector
entrepreneurs come from farming families, while
one-fifth were born to families of ordinary work-
ers. Another 15 percent are children of govern-
ment officials or enterprise managers. Moreover,
middle-class commercial landscape expressions
are quite varied.
In Sanlitun Village, a shopping mall in cen-
tral Beijing, young Chinese couples dressed to
the nines ogle the latest computers and BMWs.
The Apple store, housed in a glass box and the
Adidas one, encased in a jagged shard of ochre
and orange, are only two of numerous cyber-age
shops lining the requisite skating rink. Magnifi-
cent though it be, Sanlitun Village is not the
norm for the average middle-class shopping
experience.
A five-hour drive outside Hyderabad in central
India is a more representative example—a shop in a
dimly lit corner of a family house. Plastic jars hold
22 products such as chickpeas, teabags, and indi-
vidual packets of washing powder. The family also
runs a scrap-metal business and earns between
US$2.00 and US$4.00 a day . The new bourgeoisie
has created an enormous market for material goods.
Moreover, they feed investment in new modes of
production. For example, India' s Tata Motors has
produced the Nano, a car that costs only US$2,500,
appealing directly to this new class of spenders.
Members of the middle class are keen on
self-improvement. They try to lead healthy lives.
They value education and are more likely than
the poor to keep their children in school. They
are more apt than the rich to invest in new busi-
nesses and are more willing to learn fresh ways of
doing things. Many Asian economists argue that
it is the middle class that will provide the bulk of
hard-working business people along with a
few exceptional entrepreneurs such as Nandan
Nilekani—a founder of India' s tech giant Infosys
and Forbes magazine' s Business Man of the Y ear
in Asia in 2007.
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