The Dictionary of Human Geography

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The higher the amount ofvalue-addedin the

production process relative to the costs

incurred (of labour, materials and fixed cap-

ital), the greater is the productivity. In primary

industries, however, productivity usually

implies the ratio of production per unit area

of land rather than to its (imputed) cost.

With the growth ofserviceindustries in

advancedcapitalistsocieties, attempts have

been made to measure productivity in sectors

other than manufacturing – not least in higher

education! – though the concept ofvalue

addedis not readily applied in many such

situations. rj

profit cycle A sectoral approach to under-

standing changes experienced by regional

economies, developed by economist Ann

Markusen as an alternative to theproduct

life cyclemodel. Instead of focusing on

regularities in the changing scale of output or

changes in the qualitative characteristics of a

product and its production process over time,

Markusen (1985) argued that the economic

variable most crucial to determining industrial

change is therate of profit. Drawing her inspir-

ation from both Marx and Schumpeter, she

argued that change within an industry should

be understood in terms of two central pro-

cesses, each of which is pursued by firms to

increase market power and hence profit rates:

(i)innovationand (ii) imperfect competition.

She proposed a five-stagemodel through

which industries move:

. New industries are born and core products
are being designed: a regime ofzero profits.
. Once an innovation is commercially suc-
cessful, and so long as its production is
concentrated in the hands of a single
(monopoly) firm,super profitsare likely.
. As patents expire and/or imitation and in-
novationdiffusionfacilitates entry by new
firms, the market power once held by the
monopoly firm dissipates. Profits decline
to normal profit levels as the industry
moves towards market saturation. It is
only at this stage that conditions resemble
perfect competition.
. If some firms increase their market shares
through mergers and acquisitions, this
move towards oligopoly will raise profit
rates tonormal-pluslevels. But if the indus-
try evolves along a path of predatory pri-
cing and excessive competition, profit rates
will be squeezed tonormal-minuslevels.
. Once the sector matures to obsolescence,
negative profitswill ensue.

Markusen argues that ‘distinct spatial tenden-

cies’ accompany each stage of a sector’s pas-

sage through the profit cycle (1985, p. 24) (see

table).

The approach is a suggestive one, but it was

roundly criticized by Storper (1985) for its

essentialism. While he accepted that the

modelwas one of the most effective ways to

comprehend ‘multilocational, large-scale pro-

duction systems and sectoral location patterns

over time’, he saw it as a premature formaliza-

tion and argued for a much more historically

informed analysis of the dynamics of geo-

graphicalindustrialization. msg

property Relationships between persons

with respect to the use or benefit of valued

things. Legal scholars tend to see property

rights as residing in the ‘jural relations’

between individuals, rather than in the thing

itself. If I claim a propertyrightin a thing

(such as land), what is really being asserted is

that I can exclude you from access to it

(Macpherson, 1978a). Thelawof property

concerns itself with the legally recognized dis-

tribution of rights, benefits and responsibilities

associated with the objects of property.

Variations can occur in terms of the range

of objects over which property rights are rec-

ognized, the extent of rights that are recog-

nized and the entities that can bear such

rights. These can all be construed very

broadly: for example, the objects of property

can include not only land (land tenure) and

money, but intangibles such as names, know-

ledge and shares in joint-stock companies.

Despite this diversity, Western liberal societies

(see liberalism) tend towards a strikingly

narrow view of property, summarized by

Singer (2000) as the ‘ownership model’.

Private property, the default category here, is

viewed in largely asocial terms: The owner is

assumed to hold a full bundle of property

rights (alienation, use, exclusion etc.), and is

expected to be motivated by self-regarding

behaviour. state intervention is presump-

tively suspect, and must be justified in rela-

tion to the prior and superior rights of the

Stage Profit rate regime Spatial tendency

1 Zero profits Concentration

2 Super profits Agglomeration

3 Normal profits Dispersion

4 Normal-plus or -minus profits Relocation

5 Negative Abandonment

Gregory / The Dictionary of Human Geography 9781405132879_4_P Final Proof page 593 1.4.2009 3:20pm

PROPERTY