Post-staple bust: modeling economic effects of mine closures and post-mine demographic shifts in an arctic economy (Yukon)

Abstract

This study uses inputÁ/output (IO) and demoeconomic modeling in order to simulate direct, indirect, and induced effects of mass mine closures and subsequent population change in Yukon during the cyclical economic crisis of the late 1990s. The goal is to further the knowledge of the anatomy of resource downturn and, more importantly, its extended implications in an arctic economy. Contrary to the stylized representations, the paper argues that Yukon's economy is particularly vulnerable to fluctuations in population number and structure, in addition to the resource sector itself. Specifically, the major impact of a resource downturn on regional economy is found in induced effects related to demographic shifts (aging and depopulation) in the household sector followed by changes in consumption. This article demonstrates that high-tech and high-salary industries, and services (most favorable for the future of the region) suffer the most from population loss and aging. To trace these impacts the study utilizes several variants of single-region IO models, including extended demoeconomic IO model known as the BateyÁ/Madden or Type IV framework. In our formulation, this model emphasizes age-specific consumption and is designed to track induced changes in sectoral gross outputs resulting from income and demographic shifts.

Tracing economic transition in the mine towns of northern Ontario: An application of the “resource‐dependency model”

“…This understanding will come only from case study research. We believe, as does Petrov (2007), that the concept of path creation (Martin 2010;Steen and Karlsen 2014) will help unravel the process of economic transition in Canada's northern regions. Its application in Ontario will uncover if the new economies emerging here reflect path creation through independence, such as the transition from mining centre to retirement centre (Mawhiney and Pitblado 1999), or path creation through dependence, such as the transition from mining to mine heritage tourism (Stern and Hall 2015).…”

“…This is an appropriate addition given the growing recognition that formerly staple-reliant communities are forging new development paths and creating new economies (McAllister 2008;Markey et al 2012). Using their place-based competitive advantage, towns in northern British Columbia (Barnes and Hayter 1992), Yukon Territory (Petrov 2010), and Ontario (Stern and Hall 2015), for example, are "rebundling . .…”

Social disruption, mine closure and housing policy: evidence from the Free State Goldfields, South Africa

“…Bust cycles held long-term negative implications for mining towns (Bradbury and St-Martin, 1983;Neil et al, 1992;World Bank, 2002;Singh, 2011). A decline in mining activity is usually associated with the depopulation of an area (Petrov, 2010), declining standards of living among mineworkers (Haney and Shkaratan, 2003), community instability (Jackson, 2002), and long-term health problems among miners and in mining communities (Holton et al, 2002). Furthermore, mineworkers seldom have the skills required to work outside of mining (Bowes-Lyon et al, 2009).…”

Demographic and economic disparities among Arctic regions

“…Although, the environment and people of the Arctic are changing, this change is not constant across all geographic areas. Regions of the Arctic respond differently to exogenous shocks based on their physical location, socio-economic conditions, and ability to adapt (Arnason 2007, Petrov 2010, Pearce et al 2012. Previous research has referred to the Arctic as a whole when in fact they are only focusing on a specific area, economic sector, or social topic (Auchet 2011, Lindholt and Glomsrød 2012, Kajan 2014.…”

“…Even though the Arctic is diverse, many communities have a single "base" industry which can be resource extraction, tourism, or, in the absence of an industry, the government (Randall and Ironside 1996, Fay and Karlsdottir 2011, Petrov 2010. Communities, which rely on resource extraction, tend to be vulnerable due to fluctuations in market demand and price.…”