The restructuring of the old industrial region of Grenland in Norway: Between lock-in, adjustment, and renewal

Abstract

While the concept of ‘lock-in’ has been popular as a catch-all concept for explaining negative externalities associated with entrenched institutions in old industrial regions, recent research suggests a more nuanced account centred on path-dependent evolution. More specifically, regional economic development and restructuring might be better understood if lock-in is studied in relation to other potentially co-evolving processes, such as economic adjustment and renewal. The article indicates patterns of structural change and reported innovations, and the authors question how lock-in has co-evolved with various processes of adjustment and renewal in the old industrial area of the Grenland region in Norway, focusing on the period between 2000 and 2011. They pay specific attention to various measures of restructuring in the process manufacturing industry, the related mechanical manufacturing industry, and the emergence of a local information and communications technology (ICT) industry. While the Grenland region displays elements of economic lock-in and a continued dependence on process manufacturing, it has experienced substantial structural shifts that suggest regional renewal.

Keywords:

• economic adjustment
• economic renewal
• lock-in
• old industrial regions

Acknowledgements

The authors thank the editors (Britt Dale, Asbjørn Karlsen, and Michael Jones), copy-editor and editorial assistant Catriona Turner, and the anonymous referees for constructive comments and suggestions on how to improve the article. We also thank the Research Council of Norway for funding the research under the programme Virkemidler for Regional Innovasjon II (VRI II).

Notes

1. We use the term ‘process manufacturing’ throughout the article to indicate a type of manufacturing that typically processes one or more raw materials through various forms of input, such as power and chemicals, to produce an enhanced output. Process manufacturing is often energy intensive and can be associated with many of the industries mentioned in this article, such as the production of chemical fertilizer, metals, or petrochemicals. The category is derived from relevant NACE codes (Statistics Norway n.d. b) (NACE – Nomenclature statistique des activités économiques dans la Communauté Européenne [The statistical classification of economic activities in the European Union]).

2. Specific data collection on Grenland firms was facilitated by Statistics Norway and by Eurostat's safe centre in Luxembourg. However, the websites we have referred to provide information about the datasets. It is also important to add that we examined CIS data from 2004, 2006, 2008, and 2010.

3. By ‘mechanical manufacturing’ we refer to a subcategory of ‘mechanical engineering’ that entails the manufacturing of products employing principles from engineering, material sciences, design, and the usage of tools and machines. The subcategory is derived from relevant NACE codes (Statistics Norway n.d. b).

4. This is in part explained by the transfer of employees from Hydro to Bilfinger Industrial Services (BIS) and hence their transfer to a different NACE code.

5. The figures based on CIS data do not include the municipalities of Drangedal and Kragerø.

6. A network of ICT firms in Grenland that participated Innovation Norway's programme Arena. The Arena programme is intended to promote innovation and cooperation in business communities with a high degree of concentration and/or specialization or relatedness.