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Date of Award

12-1994

Degree Type

Thesis

Degree Name

Doctor of Philosophy (PhD)

Department

Geography

Supervisor

Dr. William P. Anderson

Abstract

This dissertation combines published Canadian Provincial and Territorial Input-Output (I-O) data with unpublished expert information to mobilize a Dynamic Multiregional lnput-Output Model (MRIO) of the Canadian economy. Specifically, the model is used to assess the interregional economic implications of developing the proven oil potential of the Mackenzie Delta and Beaufort Sea regions of Canada's Northwest Territories (NWT).

The model developed in this dissertation represents a hybrid created by merging the desirable features of the long proven MRIO approach pioneered by Chenery (1953), Moses (1955), and Polenske (1980) with those of the reformulated Dynamic I-O approach espoused by Duchin and Szyld (1985). This hybrid model explicitly accounts for the interdependence between regions, as well as the fact that certain investment plans will result in capacity exceedence in various sectors in the NWT.

Three scenarios of Arctic Oil development are evaluated, and detailed capital investment time-lines provided by the authors of these scenarios (Croasdale and McDougall, 1992) are used to provide the investment and expansion information needed to drive the model.

The dynamic MRIO model is applied to each scenario, and the interregional economic impacts associated with the construction phase for each are assessed. The results suggest that in all scenarios, as expected, the NWT experiences the largest total impacts, followed by Ontario and Quebec (central region), and Alberta and British Columbia (western region). The effects captured by the NWT are largely direct, while the effects captured by the remaining regions include significant indirect and induced effects. The analysis also illuminated a key structural difference between the economies of the western and central regions; the manufacturing sector of the former exhibited a definite resource processing focus, while in the case of the latter, the manufacturing sector appeared more diverse and mature.

The results also highlight a fact that characterizes the NWTs' experience with large scale resource projects in the past; that is, pipeline construction activities in the NWT are found to have the largest effect on the magnitude of the economic benefit captured by the NWT. Construction activities, by definition, are one of the few economic activities required in each of the scenarios which is satisfied entirely by NWT production.

The fact that the total impact in the NWT, across all scenarios, accounted for approximately 40% of the total output in the NWT (in 1984), combined with the fact that this region is characterized as a staple economy, suggests that a resurgence of oil and gas activity in the Beaufort Sea could lead to another boombust cycle of economic growth and decline in the NWT. Ongoing geopolitical change (e.g., negotiations on a Northern Accord and Comprehensive Land Claim Settlements), could act to shield this region from such a cycle to some extent, and allow the region to derive some long-term economic benefit from its resource endowment.

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