Geographical Power
and Shifts in the Recent Past

Throughout the period between
the late 1800s to 1930, commercial geography existed, which concerned commodities
according to their places of origin and their paths of transportation (MacKinnon
and Cumbers, 2007, pp23). Post World War 1, a decline in colonial empires powers
could be seen (MacKinnon and Cumbers, 2007, pp24). Realisation of the need for
major growth was globally apparent.

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1930s saw a rise of Fordism,
a system based on mass production and consumption, bringing high rates of
productivity in the workplace and expanding wages (Mackinnon and Cumbers, 2007,
pp31). This was possible through fixed expenses being shared over a larger
number of outputs thereby reducing unit costs and exploiting the division of
labour (Thompson, 2007). Years of sustained high economic growth and economic
advancements was present throughout most major world economies due to Fordism (Thompson,


Keynes emphasised just how
important government control over the level of demand in the economy to reach
full employment. States took on interventionist approaches (Mackinnon and
Cumbers, 2007, pp 31).  The Keynesian
economic theory, that consisted of two components: raising government
expenditure and lowering tax rates, aimed to stimulate demand and get economies
out of an economic downturn (Investopedia, n.d.).  


Fordism experienced many
problems leading up to the 1970s. A new form of ‘post-Fordism’ saw a larger
emphasis on the role of small firms, ICT and individualised forms of
consumption (Mackinnon and Cumbers, 2007, pp32).


Neoliberal approaches became
very apparent in the 1970s as we shifted away from Keynesianism, towards the
reduction intervention by the state and the increase in popularity of free
markets, promoting competition (MacKinnon and Cumbers, 2007, pp32). 


A rise in Marxism came about
towards the end of the 1960s (Mackinnon and Cumbers, 2007, pp30).  In its early stages, focus was based on how
capitalism can create certain geographical landscapes; there is both need for
capital to be fixed in one place and for it to be able to move around
(MacKinnon and Cumbers, 2007, pp31). Productive environments need to be built up
over a period of time, which is done through keeping capital immobile however,
if capital doesn’t eventually move, it will be unresponsive to changing
economic conditions and miss out more profitable locations (MacKinnon and
Cumbers, 2007, pp31). Spatial fix, which is “the establishment of relatively
stable geographical arrangements that facilitate the expansion of the
capitalist economy for a certain period of time” (MacKinnon and Cumbers, 2007,
pp302), saw North America and Western Europe deindustrialise in the late 1970s and
expansions in certain industries in newly industrialising countries (MacKinnon
and Cumbers, 2007, pp.31).


In the 1980s, Marxism became criticised
for being too out of touch with modern times and thought (MacKinnon and
Cumbers, 2007, pp32). Three important critiques included the view of human
beings as their class instead of their individual person, too much stress on
economic forces and relations and too much attention to class, with little to
gender or race (MacKinnon and Cumbers, 2007, pp33).


The post war welfare state
agreed with Keynesianism theories to surge economic growth. Keynes rejected the
thought of a classical market economy and was for state fiscal policy to reach
maximum employment (MacKinnon and Cumbers, 2007, pp93). Spatial Keynesianism
was enforced to close the widening gap between richer and poorer regions. Factories
and office spaces were positioned in locations that saw need for growth and
development of financial core hubs was halted to even out the development
(MacKinnon and Cumbers, 2007, pp95). These was prominent until the stagflation
crisis of the 1970s, when attention shifted towards neoliberalism (MacKinnon
and Cumbers, 2007, pp96).


Neoliberalism concerns the
underlining free market competition and is non-interventionist (Smith, n.d.).
It reinvented regulatory techniques since the early 1980s, introducing new
experiments and reforms, based on private enterprise and liberty for the people
(MacKinnon and Cumbers, 2007, pp103). Three main policies due to neoliberalism
are privatisation, liberalisation and deregulation in order to open up new
markets (MacKinnon and Cumbers, 2007, pp103). When Prime Minister Thatcher was
elected in 1979 and President Reegan in 1981, the reduction of state
intervention was put into practice, the International Monetary Fund also spread
neoliberalism across the world through grants and loans and by the early 1990s
neoliberalism was considered normal and the correct way to go about controlling
the economy (MacKinnon and Cumbers, 2007, pp104). 


During the mid 1990s, a new
balance between state socialism and free market capitalism was sort due to the
uneven implementation of neoliberal policies, as states had produced some parts
of policies whilst completely discarding other parts (MacKinnon and Cumbers,
2007, pp104). Neoliberalism has created problems which ultimately resulted in the
2007 – 2008 financial crisis. Due to the implementation of neoliberalist
policies such as deregulation and liberalisation 20 to 30 years prior, world
trade dropped and developing countries whose economies were built on exporting
raw materials saw a great downturn (MacKinnon and Cumbers, 2007, pp106 &
218). Countries that saw economic growth during the 2000s suffered dramatically,
a real chnange for Ireland the ‘Celtic Tiger’, whose growth rate suddenly plummeted
(MacKinnon and Cumbers, 2007, pp218). However, one country in particular did
not see such problems, China, due to its vast amount of infrastructure
spending, was still able to keep production and growth rates high during this
period (MacKinnon and Cumbers, 2007, pp218).


The expansion of Multinational
Corporations (MNCs) was mainly to do with state policy changes brought about since
Keynesianism was discarded (MacKinnon and Cumbers, 2007, pp106). The opening up
of national economies led to governments turning their focus to low tax and
inflation rates and more malleable labour (MacKinnon and cumbers, 2007, pp107).
In order for developing countries to receive loans and grants from the IMF and
World Bank, strict rules and conditions were imposed, including partaking in
Structural Adjustment Programmes, which are designed to advance a countries
foreign investment climate in three ways: ridding of trade and investment
regulations, cutting spending by the state and promoting exports (Chebucto,

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