Question One
In coining the theory of plant location, Weber made three simplifying assumptions. One of the assumptions was that there was a fixed center of consumption. Secondly, Weber assumed that although the distribution of raw material deposits around the globe was uneven, the cost was the same. Thirdly, Weber assumed that the centers of supply of labor are fixed and the supply of labor at a cost is unlimited. Unlike Weber’s theory that considers two factors, transportation and labor cost, the spatial margin profitability considers more factors like taxes, convenience for customers and area costs. The location of heavy industry in clusters can be explained using Weber’s theory in that this location was close to raw materials, thereby reducing the cost of transportation (Getis, Bjelland & Getis, 2014).
Question Two
The practices of outsourcing and comparative advantage shape the industrial structure of developed and developing countries in different ways. Firstly, these concepts enhance mutual trade between these countries. This is because specializations coupled with production at a lower opportunity cost compared to other nations results in bilateral trade. The efficiency that results from specialization might attract industries to set up subsidiaries in countries that have a lower opportunity cost (Getis, Bjelland & Getis, 2014).
Question Three
With the increasing significance of quaternary, quinary and high-tech industries on the economic structure of developed countries, several ramifications for economic geographic patterns are possible. Considering that these industries are not dependent on natural resources, there is a possibility for clustering around geographical areas where the resources that these industries use are locate. These include proximity to institutions of higher learning and places with high population density. One of the consequences is that these industries will be skewed towards these geographical areas (Getis, Bjelland & Getis, 2014).
Question Four
One of the motivations for outsourcing services is the low opportunity cost. Mostly, the firms in developed countries outsource their services because of in order to lower their operational costs. The rewards emanating from this are increased savings and by extension, increased profitability. This has been favorable to the home countries of the firms that outsource, because in addition to the increased savings due to lower operational costs, these firms can concentrate on their core business, leading to economic growth. Outsourcing can be stopped while the firms still remain profitable. However, there will be a reliance on the high-tech industries on ways of cost-cutting and improving efficiency (Getis, Bjelland & Getis, 2014).
References
Getis, A., Bjelland, M. & Getis, V. (2014). Introduction to geography. New York. McGraw-Hill Higher Education
