Perth Analysis

1.     Where does your city fall in the hierarchy of Central Places? Give specific examples of other places (both smaller and bigger) associated with your city?

Perth I think would be a National Metropolis because not only is it the fourth largest city in Australia, but It is also the only large city on the western half of Australia.

Smaller places associated with Perth include Freemantle, North Bridge, West Perth, High Gate, and Kings Park.

2.     What does your city offer that wouldn’t be available in a smaller place? What is unavailable locally, but that would be available in a higher order city?

Perth has a major airport, major hospital, universities, major port, major and sports and entertainment.

Perth doesn’t have higher order cities, however other major cities, like Melbourne and Sydney, can offer larger tourist attractions because they are more popular tourist and cultural destinations.

News Summary 3

1.     Briefly summarize the issue. Include a link to the article if it is available online.

http://www.skynews.com.au/business/business/market/2014/05/21/-a-hits-three-week-low.html

The Australian dollar has reached a three week low and is expected to lower. Iron ore prices have also decreased due to a decrease in Chinese demand.

2.     Relate the issue to one or more of the economic concepts we have discussed in class

The concept that relates to the iron ore price decline is supply and demand. The demand for Australian iron ore from China has decreased significantly, shifting the demand curve left and leaving the equilibrium price down. Since Australia is exporting the iron ore, Australia’s net exports will decrease. This will drive down the GDP down, hence the lowering of the Australian dollar.

3.     What led to this situation? Can you suggest a resolution to this problem? Are there policies that could improve the situation?

The article suggests that the lowering of the Australian dollar is related to the lowering of iron ore price. However doesn’t give any cause for the lowering in demand for iron ore from China.

Some solutions for this problem can come from the GDP equation. If the amount of consumption, investment, or government spending were to increase or imports would decrease, the GDP would increase. This GDP increase could be done by providing incentives, tax breaks, or tariffs to increase or decrease their respective variables. The government could also create new programs, of which would increase spending, that could monitor or help prevent this from happening in the future.

The Backhaul Response

This is a response to Chapter 5, The Backhaul, of the book "Junkyard Planet" by Adam Minter

a.     India and China are both rapidly industrializing countries with a large demand for resources, yet the vast majority of US scrap metal goes to China. Explain why.

The reason why the vast majority of US scrap metal goes to China is that the cost of transporting the scrap metal to China is cheaper than to India. One reason for this is that India is farther away from the US than China is. Also India doesn’t export many products to the US, meaning that the backhaul for shipping companies will be empty. This takes away incentives for shipping companies to ship to India from the US and back. It is much cheaper to ship to China because China does export a lot to the US making the backhaul profitable.

b.     Choose a passage from this reading that illustrates a large issue or problem related to globalization. Explain.

Globalization brings the world together, expanding markets tremendously. This expansion brings larger incentives for companies to make products have a more competitive edge in the global market. This incentive can mean companies cut corners to get that edge. One corner companies can cut involves environmental pollution. This is mentioned in the chapter, where India’s environmental authorities are pressuring manufactures to stop polluting. Being green when it comes to pollution costs money and discourages companies from being green on their own.

Globalization brings more competition and more opportunities for businesses. These businesses expand and with them pollution rises.

c.      More generally, how does modern transportation relate to the themes raised by Jared Diamond in “Why Did Human History Unfold Differently On Different Continents For The Last 13,000 Years?”

Modern transportation relates to Jared Diamond’s article in that the countries that are not players in the global markets and not involved in modern transportation, large container ships, are countries that don’t have the resources, infrastructure, and economy to participate. Many of these countries are the ones, because of the geography and climate, which could not create as sustaining and strong civilizations like that in Europe. Minter gives an example of this be explaining why Sudan is not benefiting more from modern transportation and globalization. Minter says that because Sudan “doesn’t have many factories” and is “without end markets—or the possibility of such end markets” even with cheaper labor and lower environmental standards than China, it cannot participate.

To add on, any country that has poor geography to participate in the current trade routes. Mexico, for example, has great geography because it has a lot of coastline on both the Atlantic Ocean and Pacific Ocean. Brazil is a country that has poorer geography because it only has convenient potential shipping routes in the Atlantic Ocean. Even with the Panama Canal, shipping companies have built ships that are too big for the canal making Brazil less easily accessible.

6 Week Friday Post

aChapter 1

“The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger”

By Marc Levinson

.     Identify a selection from this chapter that you found particularly interesting and explain why you selected it.

I thought the history of the advancements in transportation was interesting. It’s interesting to think that before the steamship, the only long distance mode of transportation people had was the horse and carriage. The local businesses couldn’t expand past their small area because of the high cost of shipping. Then came railroad, refrigerated railcar, truck and passenger cars, commercial aviation, and container shipping. It’s interesting to think about how the infrastructure transformed along with these innovations. These innovations transformed how people and products move, and thereby changed how people communicate around the world.

b.    How does the author see the development of the shipping container contributing to globalization?

The author sees the development of the shipping container as a major role of the globalization of the economy because of the extremely sharp drop in freight costs. The author doesn’t give the container the sole cause for the globalization because it “would be foolhardy” to do so. There are a multitude of things that contributed to globalization but the author makes the argument that the container, which significantly reduced shipping costs, was a key player.

c.     Who do you see gaining and losing from this transformation of global transportation?

Businesses that adapt to the new transportation will have huge gains in both developing countries and developed countries. However, developing countries have an advantage because they can make products cheaper.

Consumers gained a many more choices for the products they could buy along with cheaper products but workers have lost their steady increase in wage and benefits because the employer gained power.

           

Globalization has made competition a global reality making companies in the US compete with companies in Italy and India.