REGIONAL ECONOMIC AND SOCIAL RESILIENCE: An Exploratory In-Depth Study in the Nordic Countries By Alberto Giacometti and Jukka Teräs NORDREGIO REPORT 2019:2 nordregio report 2019:2 1 REGIONAL ECONOMIC AND SOCIAL RESILIENCE: An Exploratory In-Depth Study in the Nordic Countries By Alberto Giacometti and Jukka Teräs NORDREGIO REPORT 2019:2 Prepared on behalf of the Nordic thematic group for innovative and resilient regions 2017–2020, under the Nordic Council of Ministers Committee of Civil Servants for Regional Affairs. Regional Economic and Social Resilience: An Exploratory In-Depth Study in the Nordic Countries Nordregio Report 2019:2 ISBN 978-91-87295-66-9 ISSN 1403-2503 DOI: doi.org/10.30689/R2019:2.1403-2503 © Nordregio 2019 Nordregio P.O. Box 1658 SE-111 86 Stockholm, Sweden [email protected] www.nordregio.org www.norden.org Analyses and text: Alberto Giacometti and Jukka Teräs Contributors: Eeva Turunen, Mari Wøien, Hjördís Rut Sigurjónsdóttir, Lise Smed Olsen (Oxford Research), Liisa Perjo, Giuseppe Innocente, Viktor Salenius, Laura Fagerlund Nordregio is a leading Nordic and European research centre for regional development and planning, established by the Nordic Council of Ministers in 1997. We conduct solution-oriented and applied research, addressing current issues from both a research perspective and the viewpoint of policymakers and practitioners. Operating at the international, national, regional and local levels, Nordregio’s research covers a wide geographic scope, with an emphasis on the Nordic and Baltic Sea Regions, Europe and the Arctic. The Nordic co-operation Nordic co-operation is one of the world’s most extensive forms of regional collaboration, involving Denmark, Finland, Iceland, Norway, Sweden, and the Faroe Islands, Greenland, and Åland. Nordic co-operation has firm traditions in politics, the economy, and culture. It plays an important role in European and international collaboration, and aims at creating a strong Nordic community in a strong Europe. Nordic co-operation seeks to safeguard Nordic and regional interests and principles in the global community. Common Nordic values help the region solidify its position as one of the world’s most innovative and competitive. The Nordic Council of Ministers is a forum of co-operation between the Nordic governments. The Nordic Council of Ministers implements Nordic co-operation. The prime ministers have the overall responsibility. Its activities are co-ordinated by the Nordic ministers for co-operation, the Nordic Committee for co-operation and portfolio ministers. Founded in 1971. The Nordic Council is a forum for co-operation between the Nordic parliaments and governments. The Council consists of 87 parliamentarians from the Nordic countries. The Nordic Council takes policy initiative s and monitors Nordic co-operation. Founded in 1952. Stockholm, Sweden, 2019 Table of contents Foreword............................................................................................................................................................ 6 Executive summary ................................................................................................................................... 7 1. Introduction ............................................................................................................................................... 9 2. Understanding resilience: theoretical considerations ........................................... 11 3. Methodology............................................................................................................................................19 4. Case studies ............................................................................................................................................ 25 4.1 NORTHERN OSTROBOTHNIA, FINLAND ..................................................................................... 26 4.2 VESTMANNAEYJAR (WESTMAN ISLANDS), ICELAND ...........................................................36 4.3 ROGALAND, NORWAY .......................................................................................................................45 4.4 NORRBOTTEN, SWEDEN ..................................................................................................................56 4.5 VEJLE, DENMARK ...............................................................................................................................64 5. Findings ...................................................................................................................................................... 75 6. Recommendations .............................................................................................................................83 References ......................................................................................................................................................85 nordregio report 2019:2 5 Foreword Nordregio, on behalf of the Nordic Council of Min- n What is the role of regions (and their different isters Committee of Civil Servants for Regional actors) in anticipating and reacting to shocks? Affairs, is the secretariat for the Nordic thematic n How can strong and weak signals of changing group for innovative and resilient regions 2017–2020. regional resilience be recognised? During this programme, the Nordic thematic group has focused on expanding knowledge and identi- To achieve these objectives this study was divid- fying policy-relevant solutions to the challenges ed into four parts or steps: First, an overview of that the Nordic regions face when it comes to resi- the conceptual and academic debate on regional lience, smart specialisation and digitalisation. This economic and social resilience. Second, a method- report summarises the work and results achieved ology design for empirical research in the Nordic within one of the studies conducted by the the- regions. Third, field research on the five distinct matic group between 2017 and 2018, namely ‘Re- regions. And finally, a cross-case comparison. This gional economic and social resilient regions’. report follows the four steps to present the work The study takes a holistic perspective to ex- in addition to the key findings and recommenda- plore the implications of uncertainty for the Nordic tions identified. regions and to deepen the understanding on how The key question relevant to the policy makers regional authorities, companies and the society is: can resilience be built in advance? In other words, at large are able to react and respond to shocks how do we plan ahead for possible risks and shocks and disturbances. The aim is also to identify what (and slow burn) in such a way, that our societies and measures are regional authorities taking to pre- regions are better prepared to carry on and find pare for shocks and unwanted developments, ways to survive. This work provides plenty of case- either to repel them as to facilitate structural based ideas for strengthening resilience planning. change. More specifically, this study provides answers to the following research questions: n What risks/shocks are the Nordic regions vulner- Mikko Huuskonen able to? Chair of the Nordic thematic group for innovative n What are the drivers of regional resilience? and resilient regions 2017–2018 nordregio report 2019:2 6 Executive summary How capable are local and regional economies the unique context and adaptive capacity of each of recovering from exogenous and endogenous region, and a detailed understanding of the dif- (global and local) shocks and threats and ensure ferent types of shocks that a region might suffer. resilient long-term development paths? Answering Additionally, research has been increasingly em- this question was the challenge of the Nordic The- phasised the role of actors, social norms, conflicts matic Group on Innovative and Resilient regions, and processes, which highlight the role of human set by the Nordic Council of Ministers. Thus, from agency in resilience. 2017 to 2018, an exploratory in-depth study was Far from providing a full autopsy of the regions’ conducted on economic and social resilience in the risk landscape, this research project represents a Nordic regions. The empirical research included a first attempt to map the various types of risks close examination of a variety of threats as well as and stress factors that threaten the wellbeing of so- factors driving resilience in regions in all five Nor- ciety and economic performance in different Nordic dic Countries. regions. For instance, the case-study regions re- The growing concern over natural disasters, the vealed risk types such as technology driven risks, 2008–2010 global financial crisis and the shifting financial, policy induced, environment related, and geopolitical order, are some of the recent events and those resulting from sudden changes in demand or developments that have provoked policy-makers to geopolitical shifts. After delineating the ‘risk land- consider the way in which local and regional popu- scape’ of the studied regions, a distinction was lations are able to recover from exogenous and en- made between risks and stress or stress-factors. dogenous shocks and emergencies. In other words, The difference is that risks indicate the probability policy-makers are grappling with ascertaining how of a shock, whereas stress factors are not neces- resilient local economies are. Despite of the global sarily unexpected nor abrupt, but instead are factors character of today’s developments,