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Deindustrialization

Deindustrialization. From the Long Boom to the 1980s February 03, 2005. Deindustrialization. What is it?. “By Deindustrialization is meant a widespread systematic disinvestment in the nation’s basic productive capacity.” (Bluestone and Harrison 1982, 6). Deindustrialization.

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Deindustrialization

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  1. Deindustrialization From the Long Boom to the 1980s February 03, 2005

  2. Deindustrialization What is it? “By Deindustrialization is meant a widespread systematic disinvestment in the nation’s basic productive capacity.” (Bluestone and Harrison 1982, 6).

  3. Deindustrialization Two “stories” • Macro (national level) Narrative • Micro (firm level) Narrative

  4. Macro Story • U.S. As World Leader after WWII. • Military Leadership • Geopolitical Leadership • Economic Leadership • PAX AMERICANA

  5. Macro Story • U.S. As World Leader after WWII. • Military Leadership • Geopolitical Leadership • Marshall plan • Development • Bretton Woods • IMF/WB/GATT • Economic Leadership • PAX AMERICANA

  6. Macro Story • The Long Boom (late 1950s to mid 1960s) • Out Put UP • Productivity UP • Wages UP

  7. Macro Story • Virtuous Circle of Growth • High mass-consumption • Stable Labor Relations • Social/wage safety Net

  8. Macro Story • Crisis (Late 1960s to Mid 1970s) • Competition UP • Market Stagnant • Profit Rates Down

  9. Micro (firm level) Story • Corporate Response to the Economic Crisis of 1970 • Diversification into more profitable industries • Foreign Direct Investment (FDI)

  10. Micro (firm level) Story • Technological Development Facilitates • Transportation (air transport/containerization) • Communication • Deskilling of production

  11. Micro (firm level) Story • Organizational Change • MNC/TNC firm • Conglomerate firm Both lead to dis-investment in older plants and industries

  12. Micro (firm level) Story Vertical/Horizontal Integration Conglomerate Firm

  13. Macro/Micro Story in relation to US Steel Post WWII Industry Dominance Crisis in the 1970s Change in firm structure (USS to USX)

  14. Impacts of Deindustrialization • Personal • Job Loss • Income loss/ • under-employment • Loss of Family Wealth • Impacts on Physical and Mental Health

  15. Impacts of Deindustrialization • Community Level Impacts • Negative Multiplier effect • Charitable giving decreases • Public Sector (tax) revenues decrease

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