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Evaluating Impacts of the New Industry on the Regional Economy: Petrochemistry in the Far East

Author

Listed:
  • Natalya Gennadievna Dzhurka

    (Economic Research Institute FEB RAS
    Institute of Economics RAS)

  • Olga Valeryevna Dyomina

    (Economic Research Institute FEB RAS)

Abstract

The authors evaluate the effects generated in the economy of the Russian Far East by the emerging petrochemical industry center, its core in Amursk gas processing plant. The calculations are based on the regional social accounting matrix for 2015 augmented with data on gas processing and petrochemical technologies, consumption of their products. According to the assessment, with the output of new industries at 38 BCM gas and 2 MT polyethylene the regional GRP will increase by 13.9% against 2015. Also, with prevailing export orientation of the new industries the highest increment of gross output is expected in gas extraction, oil processing and electric power industry. In terms of the concept of sequential interindustry modeling, the authors estimate the temporal distribution of the obtained integral effects. In view of the above, the opportunities of two methods are revealed, the analytical and the numerical one. It is demonstrated that despite the similarity of the economic contents in both calculation methods the measure of their convergence is different as their drivers are different: the external demand for new products is behind the choice of the analytical method while the gross output is behind the numerical one. In our case a high share of external demand in the gross output of new production levels out the difference between the effects of the two methods. The researchers conclude that without lags in production and consumption the integral GRP increase will be obtained by cycle 40 (or by 2055), with lags – after cycle 50 (or by 2065). The maximum discrepancy between the two trajectories of the macro indicator (without and with lags) will be observed in the period up to cycle 25 (to 2040)

Suggested Citation

  • Natalya Gennadievna Dzhurka & Olga Valeryevna Dyomina, 2020. "Evaluating Impacts of the New Industry on the Regional Economy: Petrochemistry in the Far East," Spatial Economics=Prostranstvennaya Ekonomika, Economic Research Institute, Far Eastern Branch, Russian Academy of Sciences (Khabarovsk, Russia), issue 1, pages 51-65.
    • Handle: RePEc:far:spaeco:y:2020:i:1:p:51-65
    DOI: https://dx.doi.org/10.14530/se.2020.1.051-065
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    References listed on IDEAS

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    1. Avelino, Andre & Hewings, Geoffrey & Guilhoto, Joaquim, 2012. "PSIM – A Social-Environmental Regional Sequential Interindustry Economic Model for Energy Planning: Evaluating the Impacts of New Power Plants in Brazil," TD NEREUS 14-2012, Núcleo de Economia Regional e Urbana da Universidade de São Paulo (NEREUS).
    2. Rose, Adam, 1984. "Technological change and input-output analysis: An appraisal," Socio-Economic Planning Sciences, Elsevier, vol. 18(5), pages 305-318.
    3. Raa, Thijs Ten, 1986. "Applied dynamic input-output with distributed activities," European Economic Review, Elsevier, vol. 30(4), pages 805-831, August.
    4. Michael Sonis & Geoffrey J. D. Hewings (ed.), 2009. "Tool Kits in Regional Science," Advances in Spatial Science, Springer, number 978-3-642-00627-2, February.
    5. Avelino, Andre F. T. & Hewings, Geoffrey J.D. & Guilhoto, Joaquim José Martins, 2011. "EPSIM - An integrated sequential interindustry model for energy planning: evaluating economic, eletrical, environmental and health dimensions of new power plants," MPRA Paper 54370, University Library of Munich, Germany.
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    More about this item

    Keywords

    macroeconomic modeling; social accounting matrix; technology; fuel and energy sector; petrochemistry; economic effect; trajectory; region; Russian Far East;
    All these keywords.

    JEL classification:

    • C02 - Mathematical and Quantitative Methods - - General - - - Mathematical Economics
    • E27 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Forecasting and Simulation: Models and Applications
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods

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