Economic Development in a Developed Economy

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Economic Development in a Developed Economy
France.

• France is one of the most developed economies in
  the world and this is shown in the following
  statistics
• Population 59 million people
• Life expectancy 79 years
• Literacy rate 99
• GNP 26000
• HDI - .92
• employment structure Primary 4, Secondary
  23, Tertiary 73.
• unemployment 11
• people living in poverty (below the threshold
  of 700 per month) - 10

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• But the last 2 statistics show that, like most
  developed economies, the average figures can hide
  personal and regional differences in the quality
  of life

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• The French economy has undergone essential
  changes on its road to a developed economy
• Most employed people are now working in the
  tertiary sector (well-paid employment) and the
  primary sector is the least important.
• Greater use of technology and automation has led
  to higher productivity in manufacturing but an
  overall decline in the manufacturing sector has
  occurred as labour intensive manufacturing
  industries have relocated to lower labour costing
  countries of the south.
• Massive investment in the social and economic
  infrastructure as more profits result from
  increase trade e.g. Health, education, transport,
  energy supplies.

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Remember

• All these economic changes are shown in the
  study of the Paris Basin.
• The information on the Paris Basin should be
  used, where possible in this section.

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The Tertiary Sector Service Industries

• It dominates the French economy with
• Over 16 million people employed
• 73 of the working population
• Over 50 of the GNP
• Average yearly growth of 1.5 since 1970.

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Reasons for the growth of the service industry

• As economic development increased there was
  greater investment in health and educational
  services e.g. third-level graduates.
• As economic wealth increases the public
  administration sector grows and so the government
  is the largest employer in France. Government
  departments (environmental, finance, agriculture,
  transport) employ millions of people.

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• Public sector services (health, education,
  environment) have shown a huge increase in recent
  years
• 35 of all third level institutions in France are
  in the Paris region.
• 75 of all research, laboratory and scientific
  work is in this region e.g. La Villette science
  park in Paris.
• As average income rise, there is a greater demand
  for leisure and tourism services. People have
  more money and more time for recreational
  purposes.

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• The tourist sector has grown enormously since
  1960. Over 70 million tourists visit France each
  year and millions of people are employed directly
  and indirectly (spin-off / multiplier)
  activities.
• Tourism and its spin-off / multiplier effect is
  of great importance to the economy of the Paris
  Basin and attractions include
• Louvre, Versailles, Eiffel Tower, Disneyland
  Resort (Marne la Vallee) etc.

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• As the economy improves there is a greater demand
  for specialised services in finance, insurance,
  marketing and media e.g. 800,000 people are
  employed in the financial sector.
• In the Paris Region banking / finance employs
  over 500,000 people and 90 of the headquarters
  of French leading companies are in Paris e.g.
  Credit Lyonnais, Air France.

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• The transport infrastructure has to improve to
  meet the demands of more people with more leisure
  time. About 4 of the French workforce are
  employed in the transport sector.
• Transport networks employ about 5 of Paris
  working population.
• Rail TGV, RER, Metro
• Air 3 major airports
• Road network.

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• As incomes improve there is an increased demand
  for retailing and wholesaling services
  (supermarkets, car sales etc). Over 13 of
  employed people (nearly 3 million people) work in
  retail outlets throughout France.
• To meet the growing demands for space for
  services and to deal with the congestion in
  existing areas, the French government has
  encouraged the growth of new commercial, retail
  and financial centres away from the older centres

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• In Paris commercial retail and financial centres
  have been built at La Defense, Rungis and
  Bobigny. Offices and commercial developments have
  been built on the sites of demolished factories
  and commercial buildings e.g. Gare du Lyon,
  Montparnasse.
• The service / tertiary sector also dominates the
  economy in
• The Mediterranean Region (Marseille to Nice)
• French Alpine Region (tourism)
• The service / tertiary sector is least important
  in
• Brittany
• Massif Central (Peripheral Region)

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