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UIS BUSINESS SCHOOL MASTER’S THESIS STUDY PROGRAM: THESIS IS WRITTEN IN THE FOLLOWING SPECIALIZATION/SUBJECT: MSc Business Administration Innovation IS THE ASSIGNMENT CONFIDENTIAL? (NB! Use the red form for confidential theses) TITLE: The role of human agency in shaping the regional growth paths of peripheral regions: a case study of Kirkenes (Norway) and lessons from other regions in northern Norway, Sweden and Finland. AUTHOR(S) SUPERVISOR: Professor Bjørn Asheim Candidate number: Name: 3113 Skirmante Monteilhet ………………… ……………………………………. ………………… ……………………………………. Foreword I remember the day I was sitting in the office of Rune Fitjar, the Vice-rector for innovation at the University of Stavanger when he was explaining to me the aims of the international research project “Regional Growth against all Odds”, coordinated by the Lund University, and how my thesis could fit around it, and my astonishment at how my background (having lived under the Soviet rule, the first-hand experience of the fall of the Soviet Union, the knowledge of the Russian language, work experience in a municipality on a Russian border, previous tourism studies) were fitting into the proposal to build a case study about Kirkenes. I would like to express sincere appreciation to Rune Fitjar for believing in my ability to contribute to advancing current research by introducing me to this project. I find it a privilege to have worked on a worthwhile project together with established researchers. Not only it was a professional journey, through it I learned so much more about the history and politics and the society in Norway. My special thanks goes to my supervisor Professor Bjørn Asheim, the ReGrow project leader Markus Grillitsch, researchers Silje-Haus Reve and Nina Hjertvikrem for their patience and goodwill, inspiring and stimulating discussions that showed me how to think and analyse the data, which considerably advanced my analytical skills. I want to thank all the interviewees, Linda Beate Randal, Geir Torbjørnsen, Lars Georg Fordal, Vigdis Nygaard, James Karlsen, Jacob B. Stolt-Nielsen, Peter Steiness Larsen, Svein Sundquist, Rune Ulvang, Unni Sildnes, Kåre Tannvik, Rune Rafaelsen, Rune Rautio, Karl Eirik Schjøtt-Pedersen, Felix H. Tschudi, and Arve Henriksen for allowing a glimpse into their experiences and beliefs, which were enriching and at times inspiring. Special thanks to Mr Felix H. Tschudi for sending me the book, a documentary of the reopening of the mine, which provided me with incredible insights into the history of Kirkenes and motivations behind the reopening of the mine. I owe thanks for interesting discussions to Asta Grušelionienė, a friend and a Deputy Director of the Museum of History of Lithuania Minor, with whom we were working once on initiating change in Neringa. Last, but not the least, I am grateful for my family, my husband and my children, who showed a genuine interest in my work! 2 Table of Contents Foreword .................................................................................................................................... 2 Summary .................................................................................................................................... 3 1. Introduction ............................................................................................................................ 5 2. Theoretical framework ........................................................................................................... 8 3. Research objectives .............................................................................................................. 12 4. Method ................................................................................................................................. 12 5. Case study analysis of Kirkenes region (Norway) ............................................................... 14 5. 1. Case Background ......................................................................................................... 14 5. 2. Findings ....................................................................................................................... 20 Regional development trajectories .................................................................................. 20 - Timeline ................................................................................................................... 21 - Main phases ............................................................................................................. 22 Main phase 1: 1900-1939. ..................................................................................... 24 Main phase 2: 1945-1985. ..................................................................................... 25 Main phase 3: 1985-1997. ..................................................................................... 28 Main phase 4: 1997-2006. ..................................................................................... 32 Main phase 5: 2006-2015. ..................................................................................... 36 Main phase 6: 2015 onwards. ................................................................................ 41 Change agency ................................................................................................................ 47 Main phase 1: 1900-1939. ..................................................................................... 47 Main phase 2: 1945-1985. ..................................................................................... 49 Main phase 3: 1985-1997. ..................................................................................... 51 Main phase 4: 1997-2006. ..................................................................................... 57 Main phase 5: 2006-2015. ..................................................................................... 62 Main phase 6: 2015 onwards. ................................................................................ 71 5. 3. Discussion .................................................................................................................... 79 5. 3. 1. The role of the state agency ................................................................................ 79 5. 3. 2. Innovative entrepreneurship ............................................................................... 81 5. 3. 3. Institutional entrepreneurship ............................................................................. 83 5. 3. 4. Place-based leadership ........................................................................................ 84 5. 3. 5. Opportunity spaces ............................................................................................. 86 6. Conclusion ............................................................................................................................ 87 References ................................................................................................................................ 89 Appendices ............................................................................................................................. 106 APPENDIX I Interview Guide .......................................................................................... 106 APPENDIX II List of interviewees ................................................................................... 109 APPENDIX III Interview protocol template ..................................................................... 113 3 1. Introduction Persistent spatial inequalities – division between urban and peripheral areas – impose serious concerns for our society. While large metropolitan areas have become dynamic knowledge centres, peripheral areas experienced a loss of population, employment, and income. The division between urban and peripheral regions, which is occurring everywhere in the world, challenges political stability and democracy. United Nations (2020) predict that global population growth over the next 30 years will take place exclusively in urban areas, partially due to migration from peripheral regions. Since urban centres offer a better access to opportunities, such as jobs, education, health services, culture and infrastructure, they have attracted the most skilled people from the periphery, among them potential entrepreneurs. In Europe the spatial inequalities became particularly prominent during the 1995-2008 period until the global financial crisis, which affected metropolitan centres more than periphery (United Nations, 2020). In northern Norway migration from coastal areas in Finnmark county was alarming: out of 19 municipalities only 5-7 managed to withstand the decline (see Figure 5). Grimsrud (2019) argues that in Norway “region-enlargement” strategies, introduced in 1992 in line with EU policy of integrated regions, which shifted the focus away from small municipalities to bigger regions and promoted the development of strong regional centres, contributed to the urbanization processes. Despite overall growth, improved transport and communication as well as enhanced infrastructure, which were expected to improve access to opportunities for all, division between urban and peripheral areas persisted (United Nations, 2020). Yet certain regions benefited from these improvements more than others, and understanding why is crucial if negative trends are to be reverted. Even though the speed of urbanization in the past years has slowed down, the need to accelerate the reduction of disparities
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