UNIVERSITY OF NAIROBI
COLLEGE OF HUMANITIES AND SOCIAL SCIENCES
FACULTY OF ARTS & SCHOOL OF PHYSICAL SCIENCES
Department of Geography and Environmental Studies
TEACHING MODULE
CGP/SGP 321: ECONOMIC GEOGRAPHY
WRITTEN BY
Prof. Evaristus Irandu
Department of Geography and Environmental Studies
EDITED AND REVIEWED BY
.............................................................
Department of Geography and Environmental Studies
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Published by the Centre for Open and Distance Learning (CODL)
University of Nairobi-Kenya
2012
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Contents
INTRODUCTION TO THE UNIT ..........................................Error! Bookmark not defined.
LECTURE 1: NATURE AND SCOPE OF ECONOMIC GEOGRAPHY ............................ 11
1.0 INTRODUCTION ........................................................................................................ 11
1.1 OBJECTIVES ............................................................................................................... 11
1.2 THE NATURE OF ECONOMIC GEOGRAPHY ....................................................... 11
1.2.1 What is Human Geography? ..................................................................................... 12
1.2.2 Definition of Economic Geography .......................................................................... 12
1.3 SCOPE OF ECONOMIC GEOGRAPHY .................................................................... 14
1.3.1 The Temporal Aspect/Scope ..................................................................................... 14
1.3.2 The Spatial Aspect/Scope .......................................................................................... 15
1.3.3 The Vertical scope ..................................................................................................... 15
1.3.4 The Continental Scope .............................................................................................. 15
1.3.5 The Global Scope ...................................................................................................... 15
1.3.6 The Applicability Scope ............................................................................................ 16
1.3.7 The Theoretical Scope ............................................................................................... 16
1.4 HISTORICAL AND PHILOSOPHICAL DEVELOPMENT OF ECONOMIC
GEOGRAPHY .................................................................................................................... 17
1.5 SUMMARY .................................................................................................................. 20
1.6 REFERENCES ............................................................................................................. 21
LECTURE 2: THEORIES, MODELS AND APPROACHES IN ECONOMIC
GEOGRAPHY ........................................................................................................................ 22
2.0 INTRODUCTION ........................................................................................................ 22
2.1 OBJECTIVES ............................................................................................................... 22
2.2 KEY CONCEPTS IN ECONOMIC GEOGRAPHY .................................................... 22
2.3 THEORIES IN ECONOMIC GEOGRAPHY .............................................................. 26
2.3.1 Hypothesis ................................................................................................................. 26
2.3.2 Models (Model Building) .......................................................................................... 27
2.4 APPROACHES IN ECONOMIC GEOGRAPHY ....................................................... 28
2.4. 1 Deductive Model/Approach ..................................................................................... 28
2.4.2 Inductive Approach ................................................................................................... 29
2.5 SUMMARY .................................................................................................................. 29
2.6 REFERENCES ............................................................................................................. 30
LECTURE 3: CHANGING PERSPECTIVES IN ECONOMIC GEOGRAPHY .................. 31
3.0 INTRODUCTION ........................................................................................................ 31
3.1 OBJECTIVES ............................................................................................................... 31
3.2 MAJOR THEORETICAL PERSPECTIVES IN ECONOMIC GEOGRAPHY .......... 32
3.3 LOCATON THEORY AND NEOCLASSICAL APPROACH ................................... 34
3.4 BEHAVIOURAL APPROACH ................................................................................... 36
3.5 STRUCTURALIST APPROACH/MARXIST POLITICAL ECONOMY .................. 36
3.6 POST-STRUCTURALIST APPROACH/NEW ECONOMIC GEOGRAPHY ........... 38
3.7 SUMMARY ..................................................................Error! Bookmark not defined.
3.8 REFERENCES ............................................................................................................. 41
LECTURE 4: MEASURING LEVELS OF DEVELOPMENT ............................................. 42
4.0 INTRODUCTION ........................................................................................................ 42
4.1 OBJECTIVES ............................................................................................................... 42
4.2 DISTINGUISHING BETWEEN GROWTH AND DEVELOPMENT ....................... 42
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4.3 CONCEPT OF SUSTAINABLE DEVELOPMENT ................................................... 43
4.4 ECONOMIC INDICATORS OF DEVELOPMENT ................................................... 45
4.5 SOCIAL INDICATORS OF DEVELOPMENT .......................................................... 49
4.6 HUMAN DEVELOPMENT INDICATORS ................................................................ 51
4.7 SUMMARY .................................................................................................................. 54
4.8 REFERENCES ............................................................................................................. 55
LECTURE 5: THEORIES OF GROWTH AND DEVELOPMENT ..................................... 56
5.0 INTRODUCTION ........................................................................................................ 56
5.1 OBJECTIVES ............................................................................................................... 56
5.3 THEORIES OF UNDERDEVELOPMENT ................................................................. 61
5.3.1 Underdevelopment as a State .................................................................................... 61
5.3.2 Underdevelopment as a Process ................................................................................ 64
5.4 SUMMARY .................................................................................................................. 68
5.5 REFERENCES ............................................................................................................. 69
LECTURE 6: GLOBALISATION AND ECONOMIC DEVELOPMENT ........................... 70
6.0 INTRODUCTION ........................................................................................................ 70
6.1 OBJECTIVES ............................................................................................................... 70
6.2 THE CONCEPT OF GLOBALISATION .................................................................... 71
6.3 EVOLUTION OF GLOBALISING WORLD .............................................................. 71
6.4 BENEFITS OF GLOBALISATION............................................................................. 73
6.5 NEGATIVE ASPECTS OF GLOBALISATION ......................................................... 74
6.6: GLOBALISATION AND TRANSNATIONAL CORPORATIONS ........................ 75
6.6.1: INTRODUCTION ................................................................................................... 75
6.6.2 OBJECTIVES ........................................................................................................... 76
6.6.3 EMERGENCE OF TRANSNATIONAL CORPORATIONS (TNCs) ..................... 76
6.6.4 FOREIGN DIRECT INVESTMENTS (FDI) ........................................................... 78
6.6.5 TNCs AND GLOBALISATION ............................................................................... 83
6.6.6 TNCs AND HOME ECONOMIES ........................................................................... 85
6.6.7 TNCs AND HOST ECONOMIES ............................................................................ 85
6.7 SUMMARY .................................................................................................................. 87
6.8 REFERENCES ............................................................................................................. 88
LECTURE 7: AGRICULTURE AND FOOD PRODUCTION ............................................. 89
7.0 INTRODUCTION ........................................................................................................ 89
7.1 OBJECTIVES ............................................................................................................... 89
7.2. AGRICULTURE FROM THE VIEW POINT OF GEOGRAPHY OF
DEVELOPMENT ............................................................................................................... 90
7.2.1 DEFINITION OF AGRICULTURE ......................................................................... 90
7.2.2 APPROACHES TO THE STUDY OF AGRICULTURAL GEOGRAPHY ............ 90
7.2.3 ROLE OF AGRICULTURE IN DEVELOPMENT.................................................. 92
7.3 EVOLUTION OF AGRICULTURAL SYSTEMS ...................................................... 94
7.4 WORLD AGRICULTURAL SYSTEMS ..................................................................... 96
7.4.1 PROBLEMS OF DELIMITATION AND CLASSIFICATION ............................... 97
7.4.2 SUBSISTENCE AGRICULTURE ........................................................................... 99
7.4.3 PLANTATIONS AND AGRIBUSINESS .............................................................. 100
7.5 VON THUNEN’S MODEL OF AGRICULTURAL LOCATION ............................ 102
7.6 SUMMARY ............................................................................................................... 108
7.7 REFERENCES ........................................................................................................... 109
LECTURE 8: THE WORLD FOOD PROBLEM ................................................................ 111
8.0 INTRODUCTION ...................................................................................................... 111
8.1 OBJECTIVES .......................................................................................................... 112
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8.2 THE GROWTH OF FOOD PRODUCTION ............................................................. 112
8.2.1 TRENDS IN FOOD SUPPLY ................................................................................ 112
8.2.2 FAMINE .................................................................................................................. 113
8.3 IMPROVING FOOD SUPPLIES .............................................................................. 114
8.3.1 EXPANDING CULTIVATED LAND ................................................................... 114
8.3.2 IMPROVING FOOD DISTRIBUTION ................................................................. 115
8.3.3 AGRICULTURAL POLICIES AND LAND REFORMS ...................................... 116
IMPROVEMENT APPROACH ........................................................................................... 116
TRANSFORMATIONAL APPROACH .............................................................................. 117
LAND REFORMS ................................................................................................................ 117
8.3.4 AGRICULTURAL TECHNOLOGY AND THE GREEN REVOLUTION .......... 118
THE GREEN REVOLUTION .............................................................................................. 119
8.4 SUMMARY ............................................................................................................... 122
8.5 REFERENCES .............................................................Error! Bookmark not defined.
LECTURE 9: INTRODUCTION TO GEOGRAPHY OF INDUSTRIAL
PRODUCTION ..................................................................................................................... 123
9.0 INTRODUCTION ...................................................................................................... 124
9. 1 OBJECTIVES ............................................................................................................ 124
9.2 DEFINITION OF INDUSTRIAL GEOGRAPHY ..................................................... 124
9.3 NATURE AND SCOPE OF INDUSTRIAL GEOGRAPHY ................................. 125
9.4 THE CONCEPT OF INDUSTRY .............................................................................. 126
9.5 CLASSIFICATION OF INDUSTRIES ...................................................................... 128
9.5.1 THE INTERNATIONAL STANDARD INDUSTRIAL CLASSIFICATION
(ISIC) ............................................................................................................................ 128
9.6 INDUSTRIAL LOCATION FACTORS .................................................................... 129
9.6.1 PHYSICAL FACTORS .......................................................................................... 130
9.6.2 ECONOMIC FACTORS ......................................................................................... 131
Scale Economies ............................................................................................................... 137
9.6.3 HUMAN FACTORS ............................................................................................... 137
9.7 INDUSTRIAL LOCATION THEORY: INDUSTRIAL LOCATION SCHOOL
OF THOUGHT ................................................................................................................. 139
9.7.1 THE LEAST COST SCHOOL................................................................................ 139
CRITICISM OF WEBER’S MODEL .............................................................................. 142
9.7.2 THE MARKET AREA SCHOOL .......................................................................... 143
9.7.3 THE MARGINAL LOCATION SCHOOL ............................................................ 144
9.7.4 THE BEHAVIOURAL SCHOOL .......................................................................... 145
9.8 SUMMARY ................................................................................................................ 146
9.9 REFERENCES ........................................................................................................... 146
LECTURE 10: ROLE OF INDUSTRIALIZATION IN DEVELOPMENT ........................ 148
10.0
INTRODUCTION .............................................................................................. 148
10.1 OBJECTIVES ........................................................................................................... 148
10.2
REASONS FOR INDUSTRIALIZATION ........................................................ 148
10.3
INDUSTRIAL DEVELOPMENT STRATEGIES ............................................. 150
10.3.1
IMPORT SUBSTITUTION INDUSTRIALIZATION ................................... 150
10.3.2 EXPORT-ORIENTED INDUSTRIALIZATION (EOI) .................................... 152
10.4
SUMMARY........................................................................................................ 154
10.5 REFERENCES ......................................................................................................... 155
LECTURE 11: GEOGRAPHY OF MONEY ....................................................................... 156
11.0 INTRODUCTION .................................................................................................... 157
11.1 OBJECTIVES ........................................................................................................... 157
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11.2 DEFINITION OF GEOGRAPHY OF MONEY ...................................................... 157
11.3 ORIGINS OF MONEY............................................................................................. 159
11.4 PLACE AND THE URBAN SPATIAL DYNAMICS OF FINANCE .................... 159
11.5 MONEY AND ECONOMIC TRANSFORMATION OF SPACE .......................... 160
11.6 SAVINGS ................................................................................................................. 160
11.7 MONETARY AND FISCAL POLICIES ................................................................. 161
11.8 SUMMARY .............................................................................................................. 164
11.9 REFERENCES ......................................................................................................... 164
LECTURE 12: TERTIARY SECTOR AND ECONOMIC GEOGRAPHY OF
GLOBAL TRADE ................................................................................................................ 165
12.0 INTRODUCTION .................................................................................................... 165
12.1 OBJECTIVES ........................................................................................................... 165
12.2 FORMAL TERTIARY SECTOR ............................................................................. 166
12.2.1 Definition of Tertiary Sector ................................................................................. 166
12.2.2 Contribution of Tertiary sector to Development ................................................... 167
12.3 INFORMAL TERTIARY SECTOR......................................................................... 169
12.3.1 Definition of Informal Sector ................................................................................ 170
12.3.2 Development of Informal sector ............................................................................ 170
12.3.3 Linkages between the Formal and Informal sectors .............................................. 172
12.3.4 Obstacles faced by the Informal sector ................................................................. 172
12.4 ECONOMIC GEOGRAPHY OF GLOBAL TRADE .............................................. 173
12.4.1 BENEFITS OF TRADE ........................................................................................ 173
12.4.2 ETHICAL TRADE................................................................................................ 174
12.4.3 INTERNATIONAL TRADE THEORY ............................................................... 177
12.5 SUMMARY .............................................................................................................. 180
12.6 REFERENCES ......................................................................................................... 181
LECTURE 13: GENDER AND DEVELOPMENT ............................................................ 182
13.0 INTRODUCTION .................................................................................................... 182
13.1 OBJECTIVES ........................................................................................................... 183
13.2 DEFINITION OF CONCEPTS AND TERMS ........................................................ 183
13.3 GENDER AND FEMINIST GEOGRAPHY............................................................ 183
13.4 FEMINIST THEORY ............................................................................................... 186
13.5 SUMMARY .............................................................................................................. 187
13.6 REFERENCES ......................................................................................................... 188
LECTURE 14: URBANISATION AND DEVELOPMENT ............................................... 189
14.0 INTRODUCTION .................................................................................................... 189
14.1 OBJECTIVES ........................................................................................................... 190
14.2 URBANISATION AND URBANISM: PROBLEM OF DEFINITIONS ................ 190
14.3 URBANISATION PROCESS .................................................................................. 191
14.3.1 Global Urbanization .............................................................................................. 192
14.3.2 Urbanization in Africa ........................................................................................... 194
14.4 URBANISATION AND ECONOMIC DEVEOPMENT ........................................ 198
14.5 URBAN PROBLEMS .............................................................................................. 200
14.5.1 URBANISATION, URBAN POVERTY AND URBAN FOOD
INSECURITY ............................................................................................................... 201
14.6 CONCEPT OF SUSTAINABLE URBAN DEVELOPMENT ................................ 203
14.7 ROLE OF ENVIRONMENT AND CLIMATE CHANGE IN
SUSTAINABLE URBAN DEVELOPMENT .................................................................. 204
14.8 DEFICIENCIES IN BASIC URBAN SERVICES ................................................... 205
14.9 SUSTAINABLE MANAGEMENT OF URBAN BASIC SERVICES .................... 206
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14.10 INEFFICIENCY OF LAND POLICY IN DEVELOPING COUNTRIES ............. 207
14.11 SUSTAINABLE CITY FORM ............................................................................... 207
14.12 SUMMARY ............................................................................................................ 209
14. 13 REFERENCES ...................................................................................................... 211
LECTURE 15: REGIONAL INEQUALITIES, ECONOMIC DEVELOPMENT
PLANNING AND POLICIES .............................................................................................. 215
15.0 INTRODUCTION .................................................................................................... 215
15.1 OBJECTIVES ........................................................................................................... 216
15.2 REGIONAL INEQUALITY ..................................................................................... 216
15.3 LEVELS AND TRENDS IN SPATIAL DISPARITIES .......................................... 220
15.4 DEVELOPMENT PLANNING................................................................................ 221
15.5 REGIONAL PLANNING ......................................................................................... 221
15.7 THE GROWTH CENTRE AND CENTRE-PERIPHERY MODEL ....................... 228
15.8 SUMMARY .............................................................................................................. 235
15.9 REFERENCES .........................................................Error! Bookmark not defined.7
TABLES
Table 4.1: Selected Economic Indicators, 2005…………………………………….. 49
Table 4.2: Social Indicators for Basic Needs……………………………………….. 49
Table 4.3: Social Indicators for Selected countries, 2005…………………………....51
Table 4.4: Correlation Coefficients for Various Indicators………………………… 52
Table 5.1: Take-off Period for Countries Shown…………………………………... 59
Table 5.2: Drive to Maturity Period for Countries Shown……………………….. ...59
Table 6.1: Three Phases of Globalization Process…………………………………...72
Table 6.2: The top 20 TNCs in the World, 2005……………………………………..77
Table 7.1: Economic rent…………………………………………………………...106
Table 8.1: Countries requiring emergency food aid in Sub-Saharan Africa……….114
Table 9.1: Industrial Classification of Economic Activities………………………..126
Table 12.1: Different ways of defining tertiary sector……………………………..166
Table 12.2: GDP Composition by sector in selected Countries in 2010 (%)………168
Table 12.3: Labour force by occupations in the Developing and Developed countries
………………………………………………………………………………………169
Table 12.4: Comparative Advantage of Countries A and B………………………...178
Table 14.1: Urban population size and distribution by major geographic areas, 1950
2030…………………………………………………………………………………194
Table 14.2: Selected fastest growing cities and urban areas in Africa……………..197
Table 15.1 Countries that have adopted Growth Centre Model ……………………230
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FIGURES
Figure 2.1: Backward and forward linkages…………………………………………25
Figure 5.1: Bristow’s model of economic growth……………………………………57
Figure5.2: Four interlocking vicious...........................................................................64
Figure 7.1: The Centres of Origin of Agriculture……………………………………95
Figure 7.2a: Von Thunen’s concept of economic rent……………………………..104
Figure 7.2b: Economic rent for selected agricultural produce……………………..104
Figure 7.3: Land use in Von Thunen’s “Isolated State”…………………………...105
Figure 8.1: The inputs and outputs of the Green Revolution……………………….122
Figure 9.1: Weber’s locational theory……………………………………………...140
Figure 9.2: The effects of labour and transport costs on location………………….141
Figure 9.3: The effect of agglomeration on location……………………………….142
Figure 9.4: The theoretical shape of the market area……………………………….144
Figure 9.6: Hypothetical industrial location decisions linked to the behavioral matrix
………………………………………………………………………………………144
Fig. 12.1: Relationship between employment and per capita income………………168
Fig. 14.1: The urban transition by major regions (in million)………………………201
Fig. 15.1: Lorenz Curve……………………………………………………………219
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INTRODUCTION TO THE UNIT
Dear learner, this material was prepared with you in mind and, therefore, you will find
it easy to read, comprehend and enjoy. In the present course unit, you are introduced
to the basic concepts of economic geography such as location, agglomeration,
development, underdevelopment and economic rent among others. The different ways
of measuring levels of development of different countries are examined. Classical and
neo-classical theories of growth and development are also critically discussed. The
contribution of agriculture, industrialization, urbanization and gender to development
is also evaluated. The geography of money as well as regional development and
planning are also discussed. The material contains useful illustrations for your easy
and quick comprehension, suggested practical activities, which you are expected to
carry out (in text questions), and assignments for you to attempt at the end of each
lecture. You are expected to write out your answers and mail them for marking
according to the instructions that will be provided to you. Welcome to this exciting
and interesting Economic Geography course.
Unit Objectives
At the end of this study unit, you should be able to:

Explain the concepts of location, development,
underdevelopment and economic rent.

Discuss the various ways of measuring levels of
development of the countries of the world.

Explain
causes
of
underdevelopment
in
Less
Developed countries.

Critically evaluate the role of agriculture in the
development process.
This unit, referred to as Economic Geography, is taught at the undergraduate level to
the Bachelor of Education Science students. It is designed to train students to
appreciate the complex nature of the development process.
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