Local impacts of large investments
1997 (English)Doctoral thesis, comprehensive summary (Other academic)
The aim of the thesis is to investigate local impacts of large investments. This problem has been approached from three directions and, therefore, the study consists of three themes, namely: the changing spatial patterns of corporate activities, the short-term local economic impacts of investments, and the long-term socio-economic impacts of investments on the local municipality.
In order to put the impact studies of investments into a broader context the first theme provides an analysis of the macro-orientated processes that change the spatial pattern of a forest- based industry. The empirical investigation is based on a case-study of a major Swedish forest company (SCA — Svenska Cellulosa Aktiebolaget), analysing its development from the 1950s to the present (Paper I). The locational changes of production plants, sales units and headquarters have been mapped and, parallel to this study of the company's spatial evolution, the underlying corporate strategies are discussed.
The second theme focuses on the short-term local economic impacts of investments which are carried out at production units. The empirical data has been collected from a major investment introducing a new technology (Light Weight Coated paper - LWC) at Ortviken, an SCA-owned paper mill in Sundsvall. The point of departure for the analysis is the identification of contracted suppliers and their location in order to obtain a picture of the investment's diffusion in the local economy. As the choice of supplier is an important part of the study, criteria on how suppliers are chosen have also been examined (Paper II). Moreover, by using results from a number of similar investment studies, an attempt is made to summarize general experiences within a tentative model for estimating the share of local purchase deriving from major investments: the Local or Non-Local (LNL) model (Paper III).
The third theme of the thesis pinpoints long-term local impacts of large investments. The investment generates impacts not only concurrently with the implementation phase, but also during the operation period of the invested item. The investigation of long-term socio-economic impacts has been performed by two studies employing different methodological approaches. The first study (Paper IV) deals with ex ante local impacts of locating a nuclear waste repository in Storuman or Mala, two sparsely populated municipalities in northern Sweden. The model is a traditional macro- formulated cohort model which is combined with a 'basic/non-basic' assumption regarding the intcrdependency within the local trade and business. The second study (Paper V) refers once again to the forest-based industry by emphasising the long-term socio-economic impacts of the investment examined in Paper II. This paper employs a micro-analytical modelling approach, so that, the municipal population is represented individually within the model. A microsimulation model is elaborated in order to analyse the long-term (15 years) local population and labour market dynamics induced by the LWC-investment.
Some major findings of the thesis are:
* The share of local purchase is connected to the composition of the investment. Analyses have shown that the higher the technological demand and the more technically advanced the goods and services related to the investment, the smaller is the local share of the purchase.
* It has proved possible to trace chain effects on different local labour-markets induced by changes in production at a particular place of work. Through linkages between the partial labour markets the closure of a major place of work will not only affect the occupational groups to which laid-off employees belong, but also give rise to changes in unemployment levels in many other occupations.
Place, publisher, year, edition, pages
Umeå: Umeå universitet , 1997. , 38 p.
GERUM, ISSN 1402-5205 ; 1997:2
Pulp and paper industry, internationalisation, investments, local socio-economic impacts, microsimulation
IdentifiersURN: urn:nbn:se:umu:diva-54472ISBN: 91-7191-314-9OAI: oai:DiVA.org:umu-54472DiVA: diva2:523942
1997-05-31, Umeå universitet, Umeå, 10:00 (Swedish)
Alvstam, Claes-Göran, Professor