Given the rate of technological development over the last few decades, it is tempting to think that geography no longer matters when it comes to the global economy. It is argued that time-space shrinking technologies, such as the Internet, have made “place” all but an irrelevance. Scholars such as Thomas Friedman (2005) argue that “the world is [now] flat”. In addition, the UK Trade Secretary, Dr. Liam Fox MP, recently suggested that we live in a “post-geography trading world”. This MythBuster will question that hypothesis; globalization is transforming the way that geography matters, as opposed to making location an irrelevance as Fox and Friedman suggest.
Thanks to the internet, individuals from around the world can communicate easily regardless of physical distance- an individual from Australia can Skype a friend in the UK for free, 24 hours a day. Thus, space has arguably “shrunk” due to time-space shrinking communication technologies. But does that make geography an irrelevance?
Well, the Internet is underpinned by extensive infrastructural networks. Specifically, data centers are needed to process information. These data centers require vast amounts of electricity. In addition, this demand can fluctuate throughout the day. Thus, hydroelectric power is the most suitable form of electricity generation. This particular form of electricity production, however, generates great amounts of heat and thus requires huge volumes of cooling water. Thus, data centers have their own locational requirements and serve to illustrate the renewed importance of geography.
Geography also matters in terms of access to the internet. From a UK perspective, there is a huge divide between urban and rural areas regarding internet access, particularly in terms of fiber optic networks (read more here). But internet access is not just spatially uneven within countries but between them as well (useful link here).
Case Study: Facebook Data Center in Prineville, Oregon
Facebook is the world’s largest social media site; it is the medium through which people most commonly communicate. In April 2011, Facebook opened its own data center in Prineville. Why Prineville, though, if geography is now an irrelevance?
Well, Prineville is a remote site and thus was great in terms of security. Additionally, there were other physical locational advantages; the data center does not have air conditioning but makes use of a clever evaporative cooling mechanism. Prineville’s dry and cool climate facilitates this mechanism. Alternatively, the state of Oregon played an important role in deciding where to build the data center. Prineville is also part of a “long-term rural enterprise zone” meaning the Oregon state offered firms and individuals specific tax exemptions. Hence, this case study illustrates that geography (as well as nation-states) continues to shape global economic activity.
- Good/accessible read: http://www.economist.com/news/special-report/21565007-geography-matters-much-ever-despite-digital-revolution-says-patrick-lane
Advanced read: http://www.casa.ucl.ac.uk/cyberspace/Malecki_econ_geog.pdf