Geography Grade 7: Economic Geography Why Industries Locate Where They Do

Grade 7 Geography Study Guide: Economic Geography – Why Industries Locate Where They Do

1. The Driving Question

"If you could build a factory anywhere in the world, where would you put it—and why wouldn’t you just pick the cheapest land you can find? Why are sneaker companies clustered in Vietnam, tech startups in Silicon Valley, and car factories near highways instead of beaches? What invisible rules decide where stuff gets made?"

By the end of this guide, you’ll be able to predict where an industry should locate—not just where it does.

2. The Core Idea – Built, Not Listed

Imagine you’re opening a lemonade stand—but instead of your front yard, you’re choosing a city for a giant lemonade factory. You’d think: Where can I get the cheapest lemons? But that’s not enough. You also need: - Workers (are there people nearby who can operate machines, or will you have to train them?) - Customers (is the city full of thirsty people, or will you have to ship lemonade across the country?) - Roads/ports (can trucks deliver lemons and take away lemonade, or will they get stuck in traffic?) - Rules (does the city tax lemonade? Do they let you dump waste in the river?)

Now scale this up to real industries, and you’ll see why: - Toy factories cluster in Shenzhen, China—not because land is cheap, but because there’s a skilled workforce, ports for shipping, and suppliers for plastic and electronics all in one place. - Movie studios stay in Los Angeles—not for the weather, but because actors, directors, and special effects crews all live there, and equipment rental companies are nearby. - Call centers move to India or the Philippines—not because people there love phone jobs, but because wages are lower, English is widely spoken, and time zones align with U.S. business hours.

Industries don’t just pick places randomly. They follow four invisible forces that pull them toward certain locations:

Key Vocabulary

1. Agglomeration
2. Definition: When businesses in the same industry cluster together to share resources, workers, and ideas.
3. Example: Detroit in the 1950s—car companies, tire makers, and steel mills all located there, so parts were cheap and workers had skills.

4. Grade 9–12 note: In college, this expands to economies of scale and network effects—how clustering can create monopolies or innovation hubs.

5. Break-of-Bulk Point

6. Definition: A place where goods switch from one type of transportation to another (e.g., ship to truck), forcing industries to locate nearby to save money.
7. Example: Chicago’s stockyards in the 1800s—cattle arrived by train, were slaughtered, and meat was shipped out by rail. If the stockyards were far from the train station, costs would skyrocket.

8. Grade 9–12 note: Modern examples include Amazon warehouses near airports or oil refineries near ports.

9. Footloose Industry

10. Definition: A business that can locate anywhere because it doesn’t depend on raw materials, transportation, or a specific workforce.
11. Example: Software companies—they only need computers and internet, so they can be in Austin, Texas (cheap living) or San Francisco (talent pool).

12. Grade 9–12 note: These industries are growing because of remote work and cloud computing, but they still cluster in cities for venture capital and networking.

13. Site vs. Situation

14. Definition:
    • Site = The physical characteristics of a place (flat land, climate, rivers).
    • Situation = A place’s location relative to other things (near customers, highways, or competitors).
15. Example: Denver, Colorado is a great site for solar energy (lots of sun) but a bad situation for shipping goods (far from ports). New York City is the opposite—terrible site (expensive, crowded) but great situation (near banks, media, and customers).
16. Grade 9–12 note: In urban planning, site determines what can be built, while situation determines why it succeeds.

3. Assessment Translation

How This Appears on State Tests (Grade 7)

• Multiple Choice: Questions will ask you to identify why an industry locates in a specific place (e.g., "Why are car factories often near highways?").
• Distractor patterns:
  • Too simple (e.g., "Because the land is cheap" when the real reason is transportation).
  • Confusing site/situation (e.g., picking a site factor like "flat land" when the question is about situation like "near customers").
  • Overgeneralizing (e.g., "All factories need water" when only some, like paper mills, do).
• Short Answer: You’ll get a map or data table (e.g., "A company is choosing between City A and City B—City A has a port, City B has cheap land") and must explain which city is better and why, using at least two factors.
• Evidence-Based Writing (Longer Response): You might analyze why a real industry (e.g., Hollywood, Silicon Valley) located where it did, using 3+ factors from the core idea.

What a Proficient Response Looks Like

Prompt: "A company makes refrigerators. It needs steel, a skilled workforce, and a way to ship refrigerators to stores. Should it locate near a steel mill in Pittsburgh, a port city like Los Angeles, or a small town in Iowa with cheap land? Explain your choice using at least two factors from economic geography."

Proficient Student Response: "The company should locate near Los Angeles because it’s a break-of-bulk point—refrigerators can be shipped by boat to stores across the country, saving money. Even though steel is cheaper in Pittsburgh, Los Angeles has a skilled workforce (many factories already exist there) and highways/ports to move the finished product. Iowa’s cheap land doesn’t help because shipping refrigerators from there would be too expensive, and there aren’t enough workers with factory experience."

What the Teacher Looks For: ? Specific factors (not just "it’s better") ? Trade-offs (e.g., "steel is cheaper in Pittsburgh, but shipping is harder") ? Real-world logic (not just repeating the prompt)

Developing Response (Loses Credit): "They should go to Los Angeles because it’s a big city and has lots of people. Pittsburgh is too far away from stores." Why it loses credit: - Vague ("big city" isn’t a factor; "lots of people" could mean customers, not workers). - No trade-offs (ignores steel costs). - No economic geography terms (missing break-of-bulk point or situation).

4. Mistake Taxonomy

Mistake 1: Confusing "Cheap Land" with the Real Reason

Question: "Why are many tech companies located in Silicon Valley, California, instead of a place with cheaper land like Kansas?" Common Wrong Answer: "Because land is expensive in Silicon Valley, so companies want to be there to show off." Why It Loses Credit: - Misreads the question—it’s asking why they stay despite high costs, not if land is expensive. - Ignores agglomeration—the real reason is skilled workers, investors, and suppliers are already there. Correct Approach: "Silicon Valley is expensive, but tech companies stay because of agglomeration—there are already programmers, venture capitalists, and hardware suppliers nearby. Moving to Kansas might save money on land, but the company would struggle to find workers and investors. It’s like a lemonade stand moving to a desert—cheaper, but no customers."

Mistake 2: Picking Only One Factor (When the Question Asks for Two)

Question: "A shoe company is deciding between Vietnam and Mexico. Vietnam has cheaper labor, but Mexico is closer to U.S. customers. Which country should it choose, and why? Use two factors in your answer." Common Wrong Answer: "Vietnam because labor is cheaper." Why It Loses Credit: - Incomplete explanation—only addresses one factor (labor costs) when the question asks for two. - Ignores trade-offs—doesn’t consider shipping costs or time zones. Correct Approach: "The company should choose Mexico because even though labor is more expensive, shipping to the U.S. is faster and cheaper (lower transportation costs). Also, being in the same time zone makes it easier to coordinate with U.S. stores. Vietnam’s cheap labor is offset by higher shipping costs and delays."

Mistake 3: Mixing Up Site and Situation

Question: "Why are ski resorts often located in the Rocky Mountains instead of Florida? Use the terms site and situation in your answer." Common Wrong Answer: "Because the Rocky Mountains are near big cities, so more people can visit." Why It Loses Credit: - Wrong term—being near cities is situation, but the question is about ski resorts, which depend on site (snow, elevation). - Misses the key factor—ski resorts need physical conditions (snow, slopes), not just customers. Correct Approach: "Ski resorts locate in the Rocky Mountains because of site factors—the high elevation and cold climate create good snow conditions. Florida’s site (flat, warm) can’t support skiing, even if its situation (near cities) is good for other businesses. A ski resort’s location depends on site first, situation second."

5. Connection Layer

1. Within Geography-Urbanization "Why industries locate where they do"-Why cities grow where they do—cities like Detroit and Pittsburgh exploded because of agglomeration (factories clustering), while cities like Las Vegas grew because of situation (near highways and tourists).

2. Across Subjects-Economics (Supply & Demand) "Break-of-bulk points"-How transportation costs affect prices—if a company has to switch from ships to trucks, costs go up, so prices for consumers rise. This is why Amazon builds warehouses near cities—to cut shipping time and costs.

3. Outside School-Your Phone’s Supply Chain "Footloose industries"-Why your iPhone is designed in California but assembled in China—Apple’s R&D (research) is footloose (can be anywhere with engineers), but manufacturing clusters in Shenzhen (agglomeration of factories and workers). Next time you see "Assembled in China," you’ll know why.

6. The Stretch Question

"If the internet lets people work from anywhere, why do tech companies still cluster in expensive cities like San Francisco or New York? Shouldn’t they all move to cheap places like Boise or Tulsa?"

Pointer Toward the Answer: Tech companies could move, but they don’t because agglomeration still matters—even with remote work, investors, lawyers, and top engineers want to meet in person. Cities like San Francisco also have universities (Stanford, Berkeley) that train workers and venture capital firms that fund startups. However, some companies are leaving—like Tesla moving its HQ to Texas—because remote work tools (Zoom, Slack) make it easier to hire talent elsewhere. The real question is: Will cities like San Francisco shrink, or will they adapt by offering things Boise can’t (like world-class restaurants and networking events)?