Factors that Influence Economic Activity

Natural Resources
Natural resources are materials on or in the earth, such as trees, fish, coal, oil or gold, that
have economic value. Materials from the earth become resources only when the society
has the technology and ability to transform those resources into goods. When geographers
study the economy of a region they look closely at the location quality, and quantity of
natural resources.
What natural resources are available for development in Southwest Asia/Middle East?

Climate and Vegetation

Economic activity is affected when the climate is extreme, when weather is too hot, too
cold, too wet or too dry to make economic activity possible. Heat and temperature restrict
outdoor activities. Lack of water inhibits agricultural production. The Middle East has
extreme high temperatures and very low rainfall across the region that have a direct impact
on economic activity.
What impact do the climate and available vegetation have on SW Asia?

Technology
Technology helps people overcome the extremes of climate and vegetation. Technology
refers to the tools that make a job easier to do. In this region today that includes
machinery, air conditioning, water and oil drilling equipment, cell phones, computers and
internet access among other things. Technology comes at a cost, usually requiring higher
levels of education to be able to use it.
How have new technologies changed life in Southwest Asia?

Culture

The cultural beliefs of a region have a direct impact on economic activities in a region. The
roles of individuals are defined by cultural beliefs. Women in Southwest Asia are many
times restricted to their homes and not educated to fill any job outside the home. Economic
development can be hampered if half of your population is not allowed to have the
education necessary to fill jobs outside the home. Religious and cultural beliefs often tend
to favor more traditional lifestyles and roles for all people. In most countries of the region,
religious law dominates government legal systems and civil/criminal law.
How do cultural beliefs impact economic development in SW Asia?

Education
As economic activities become more complex, education becomes an essential element for
economic development. Schools and universities are necessary to produce and educated
worker.
What effect might cultural values have on the education system in the Middle East?

Capital
Capital (TAL) is money available for investment. Traditionally, investment capital in this
region came from outside sources – Europe and the United States. Now with oil wealth
available at record amounts in the region, capital investment is generated locally. However,
some countries are not oil rich and others [like Iraq] do not have their oil fields producing at a
strong enough capacity to generate capital for the country/government.
How has oil money changed life in the region? How should countries spend their oil wealth?

© Houston ISD Curriculum 2016 Secondary Social Studies

 Factors that Influence Economic Activity

Read the description from the Library of Congress about the changes brought
about in Saudi Arabia by the discovery of oil:
Before the discovery of oil in the Arabian Peninsula in 1938, the lands that today make
up Saudi Arabia were home to rather isolated clusters of people engaged in a simple
agricultural and service economy. The western province depended chiefly on
subsistence agriculture, some trade, and service to pilgrims traveling to Mecca and
Medina. The eastern province was dominated by a plantation economy growing dates
and other cash crops. An extremely hostile environment separated people. Permanent
habitation could exist only where there was water -- at natural springs and wells. The
long distances between water sources, the difficulty of travel, and the lack of readily
exploitable natural resources discouraged settlement and foreign investment.

The discovery of huge reserves of oil in 1938 completely changed the primitive Saudi
economy. The establishment of a national oil company and the new towns around the
oil fields triggered major changes, especially in the eastern province. Development of
oil fields required construction of modern ports, roads, housing, power plants, and water
systems. Saudi workers had to be trained in new skills. The numbers of oil field
employees and the range of services needed opened new economic opportunities on a
scale previously unseen by local merchants, contractors, and others. In fact, large
numbers of foreign workers were recruited to fill many of the job openings. At one time,
an estimated two-thirds of workers in Saudi Arabia were from other countries. The
discovery of oil ended the kingdom's isolation and introduced new ways to organize the
production and distribution of goods and services, not to mention creating tremendous
national and personal wealth. The population of many countries in the region has
increased by 200% to 300% in the last 40 years, creating a drain on other valuable
resources such as water.

© Houston ISD Curriculum 2016 Secondary Social Studies