IDEAS home Printed from https://ideas.repec.org/a/eee/jrpoli/v82y2023ics0301420723002969.html
   My bibliography  Save this article

How environmental permitting uncertainty in large-scale mining could influence subcontractors: The underlying chicken-and-egg problem

Author

Listed:
  • Söderholm, Patrik

Abstract

This paper addresses the link between the environmental permitting of mining operations and economic development in mineral-rich regions. The purpose is to investigate how uncertainty about the permitting outcomes facing a mining company could affect its subcontractors. A key conceptual point of departure is that this influence can be related to both withheld investments and a lower demand for key inputs, including labor, but also to a reduced overall attractiveness of the community, in turn making it difficult to recruit skilled labor. These issues are illustrated in the empirical context of a Swedish iron ore producer, which for over two years faced the risk of having its existing environmental permit revoked. The results suggest that in this specific case, the main challenge for the affected subcontractors was increased difficulties in recruiting skilled personnel. At a general level, the findings indicate the need to devote increased research attention to the link between government regulation on the one hand, and business growth and regional development on the other, including reputational effects. The paper also discusses the implications for the reform of existing environmental permitting process, nevertheless arguing against the incorporation of additional dimensions of sustainability in this process.

Suggested Citation

  • Söderholm, Patrik, 2023. "How environmental permitting uncertainty in large-scale mining could influence subcontractors: The underlying chicken-and-egg problem," Resources Policy, Elsevier, vol. 82(C).
    • Handle: RePEc:eee:jrpoli:v:82:y:2023:i:c:s0301420723002969
    DOI: 10.1016/j.resourpol.2023.103585
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0301420723002969
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.resourpol.2023.103585?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Thomas Moritz & Thomas Ejdemo & Patrik Söderholm & Linda Wårell, 2017. "The local employment impacts of mining: an econometric analysis of job multipliers in northern Sweden," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 30(1), pages 53-65, April.
    2. Söderholm, Kristina & Söderholm, Patrik & Helenius, Heidi & Pettersson, Maria & Viklund, Roine & Masloboev, Vladimir & Mingaleva, Tatiana & Petrov, Viktor, 2015. "Environmental regulation and competitiveness in the mining industry: Permitting processes with special focus on Finland, Sweden and Russia," Resources Policy, Elsevier, vol. 43(C), pages 130-142.
    3. Serdar Kale & David Arditi, 2001. "General contractors' relationships with subcontractors: A strategic asset," Construction Management and Economics, Taylor & Francis Journals, vol. 19(5), pages 541-549.
    4. Campbell, Gary & Roberts, Mark, 2010. "Permitting a new mine: Insights from the community debate," Resources Policy, Elsevier, vol. 35(3), pages 210-217, September.
    5. Edward L. Glaeser & Matthew G. Resseger, 2010. "The Complementarity Between Cities And Skills," Journal of Regional Science, Wiley Blackwell, vol. 50(1), pages 221-244, February.
    6. Radetzki, Marian, 1982. "Regional development benefits of mineral projects," Resources Policy, Elsevier, vol. 8(3), pages 193-200, September.
    7. Söderholm, Patrik & Svahn, Nanna, 2015. "Mining, regional development and benefit-sharing in developed countries," Resources Policy, Elsevier, vol. 45(C), pages 78-91.
    8. Lise Tole & Gary Koop, 2011. "Do environmental regulations affect the location decisions of multinational gold mining firms?," Journal of Economic Geography, Oxford University Press, vol. 11(1), pages 151-177, January.
    9. Vincent Moreau & Piero Carlo Dos Reis & François Vuille, 2019. "Enough Metals? Resource Constraints to Supply a Fully Renewable Energy System," Resources, MDPI, vol. 8(1), pages 1-18, January.
    10. Patrik Söderholm & Ann-Kristin Bergquist & Maria Pettersson & Kristina Söderholm, 2022. "The political economy of industrial pollution control: environmental regulation in Swedish industry for five decades," Journal of Environmental Planning and Management, Taylor & Francis Journals, vol. 65(6), pages 1056-1087, May.
    11. Michael R. Betz & Mark D. Partridge & Belal Fallah, 2016. "Smart cities and attracting knowledge workers: Which cities attract highly-educated workers in the 21st century?," Papers in Regional Science, Wiley Blackwell, vol. 95(4), pages 819-841, November.
    12. Clara Mulder, 2006. "Population and housing," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 15(13), pages 401-412.
    13. Yıldız, Taşkın Deniz & Kural, Orhan, 2020. "The effects of the mining operation activities permit process on the mining sector in Turkey," Resources Policy, Elsevier, vol. 69(C).
    14. Magnus Lindmark & Ann Kristin Bergquist, 2008. "Expansion for pollution reduction? Environmental adaptation of a Swedish and a Canadian metal smelter, 1960-2005," Business History, Taylor & Francis Journals, vol. 50(4), pages 530-546.
    15. Clements, Kenneth W. & Johnson, Peter L., 2000. "The minerals industry and employment in Western Australia: assessing its impacts in federal electorates," Resources Policy, Elsevier, vol. 26(2), pages 77-89, June.
    16. Zucker, Lynne G & Darby, Michael R & Brewer, Marilynn B, 1998. "Intellectual Human Capital and the Birth of U.S. Biotechnology Enterprises," American Economic Review, American Economic Association, vol. 88(1), pages 290-306, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Paula Prenzel & Simona Iammarino, 2018. "Ageing labour: How does demographic change affect regional human capital?," Papers in Evolutionary Economic Geography (PEEG) 1832, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Aug 2018.
    2. Yıldız, Taşkın Deniz, 2020. "The impacts of EIA procedure on the mining sector in the permit process of mining operating activities & Turkey analysis," Resources Policy, Elsevier, vol. 67(C).
    3. Lopes, Alef & Ruiz, Ricardo & Ribeiro, Rafael & Cantelmo, Weslley, 2023. "Linkages in the metal mining industry: Local job multipliers in Brazil," Resources Policy, Elsevier, vol. 82(C).
    4. Yıldız, Taşkın Deniz, 2022. "Considering the recent increase in license fees in Turkey, how can the negative effect of the fees on the mining operating costs be reduced?," Resources Policy, Elsevier, vol. 77(C).
    5. Thomas Moritz & Thomas Ejdemo & Patrik Söderholm & Linda Wårell, 2017. "The local employment impacts of mining: an econometric analysis of job multipliers in northern Sweden," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 30(1), pages 53-65, April.
    6. Paula Prenzel & Simona Iammarino, 2021. "Labor Force Aging and the Composition of Regional Human Capital," Economic Geography, Taylor & Francis Journals, vol. 97(2), pages 140-163, March.
    7. Winters, John V., 2014. "The Production and Stock of College Graduates for U.S. States," IZA Discussion Papers 8730, Institute of Labor Economics (IZA).
    8. Söderholm, Kristina & Söderholm, Patrik & Helenius, Heidi & Pettersson, Maria & Viklund, Roine & Masloboev, Vladimir & Mingaleva, Tatiana & Petrov, Viktor, 2015. "Environmental regulation and competitiveness in the mining industry: Permitting processes with special focus on Finland, Sweden and Russia," Resources Policy, Elsevier, vol. 43(C), pages 130-142.
    9. Holley, Elizabeth A. & Mitcham, Carl, 2016. "The Pebble Mine Dialogue: A case study in public engagement and the social license to operate," Resources Policy, Elsevier, vol. 47(C), pages 18-27.
    10. Söderholm, Patrik & Svahn, Nanna, 2015. "Mining, regional development and benefit-sharing in developed countries," Resources Policy, Elsevier, vol. 45(C), pages 78-91.
    11. Patrik Söderholm & Magnus Ericsson & Frida Hellman, 2024. "The perils of ranking mining countries and regions: a critical look at the annual survey of the Fraser Institute," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 37(2), pages 313-330, June.
    12. Yıldız, Taşkın Deniz, 2022. "How can the state rights be calculated by considering a high share of state right in mining operating costs in Turkey?," Resources Policy, Elsevier, vol. 75(C).
    13. Goodall, Amanda H., 2009. "Highly cited leaders and the performance of research universities," Research Policy, Elsevier, vol. 38(7), pages 1079-1092, September.
    14. Gersbach, Hans & Schneider, Maik & Schneller, Olivier, 2010. "Optimal Mix of Applied and Basic Research, Distance to Frontier, and Openness," CEPR Discussion Papers 7795, C.E.P.R. Discussion Papers.
    15. Cornelia Lawson, 2013. "Academic Inventions Outside the University: Investigating Patent Ownership in the UK," Industry and Innovation, Taylor & Francis Journals, vol. 20(5), pages 385-398, July.
    16. Lynne G. Zucker & Michael R. Darby, 1996. "Costly Information in Firm Transformation, Exit, or Persistent Failure," NBER Working Papers 5577, National Bureau of Economic Research, Inc.
    17. Rui Baptista & Joana Mendonça, 2010. "Proximity to knowledge sources and the location of knowledge-based start-ups," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 45(1), pages 5-29, August.
    18. Junfu Zhang, 2006. "A Study of Academic Entrepreneurs Using Venture Capital Data," PPIC Working Papers 2006.01, Public Policy Institute of California.
    19. Saul Lach & Mark Schankerman, 2008. "Incentives and invention in universities," RAND Journal of Economics, RAND Corporation, vol. 39(2), pages 403-433, June.
    20. Charlotte Senftleben-König, "undated". "Public Sector Employment and Local Multipliers," BDPEMS Working Papers 2014010, Berlin School of Economics.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jrpoli:v:82:y:2023:i:c:s0301420723002969. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/30467 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.