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Barriers to regional industrial development: An analysis of two specialised industrial regions in Norway

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The article aims to broaden the understanding of barriers to regional industrial development by focusing on the use and modification of the regional asset base. The authors employ Maskell & Malmberg’s categorisation of assets and they regard asset modification through change agency as a vital part of regional industrial development. They aim both to complement Grabher’s ‘lock-in’ approach and to provide a wider understanding of how barriers can be lowered through their empirical investigation of two specialised regions in Norway, Stavanger and Grenland. The authors address three research questions: What are historically created key regional assets in the two specialised regions? Do the assets function as support or barriers to green path development? If they are barriers, what are key agencies for lowering them? The findings demonstrate that the regional asset base functions both as support and as a barrier. To lower the barriers, both asset reuse and asset creation are deployed by actors in the region. The authors conclude that the article’s two main contributions are that with regard to the regional asset base, a relevant framework can identify possible barriers to regional industrial development, and the finding that barriers can be lowered through asset modification.
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Barriers to regional industrial development: An
analysis of two specialised industrial regions in
Norway
Maren Songe Eriksen & Maria Tønnessen Frivold
To cite this article: Maren Songe Eriksen & Maria Tønnessen Frivold (2023): Barriers to regional
industrial development: An analysis of two specialised industrial regions in Norway, Norsk
Geografisk Tidsskrift - Norwegian Journal of Geography, DOI: 10.1080/00291951.2023.2192225
To link to this article: https://doi.org/10.1080/00291951.2023.2192225
© 2023 The Author(s). Published by Informa
UK Limited, trading as Taylor & Francis
Group
Published online: 17 Apr 2023.
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Barriers to regional industrial development: An analysis of two specialised
industrial regions in Norway
Maren Songe Eriksen & Maria Tønnessen Frivold
Department of Working Life and Innovation, University of Agder, Norway
ABSTRACT
The article aims to broaden the understanding of barriers to regional industrial development by
focusing on the use and modication of the regional asset base. The authors employ Maskell &
Malmbergs categorisation of assets and they regard asset modication through change agency
as a vital part of regional industrial development. They aim both to complement Grabhers
lock-inapproach and to provide a wider understanding of how barriers can be lowered
through their empirical investigation of two specialised regions in Norway, Stavanger and
Grenland. The authors address three research questions: What are historically created key
regional assets in the two specialised regions? Do the assets function as support or barriers to
green path development? If they are barriers, what are key agencies for lowering them? The
ndings demonstrate that the regional asset base functions both as support and as a barrier. To
lower the barriers, both asset reuse and asset creation are deployed by actors in the region. The
authors conclude that the articles two main contributions are that with regard to the regional
asset base, a relevant framework can identify possible barriers to regional industrial
development, and the nding that barriers can be lowered through asset modication.
ARTICLE HISTORY
Received 18 March 2022
Accepted 12 March 2023
EDITORS
Svein Gunnar Sjøtun,
Catriona Turner
KEYWORDS
agency, asset modication,
barriers, green path
development, regional
industrial development
Eriksen, M.S. & Frivold, M.T. 2023. Barriers to regional industrial development: An analysis of two specialised
industrial regions in Norway. Norsk Geogrask TidsskriftNorwegian Journal of Geography Vol. 00, 0000. ISSN
0029-1951.
Introduction
Regional economies face the constant challenge of
rebuilding their economic structures and counteracting
old industrial activities to avoid stagnation (Asheim
et al. 2019). In recent decades, globalisation, climate
change, and other grand societal challenges have made
regional industrial development even more intrusive
(Tödtling & Trippl 2018). Furthermore, businesses are
increasingly expected to respond to societal needs
beyond the shareholders, and to involve also stake-
holders and society as a whole, by taking responsibility
for their activities and impact (von Schomberg 2019;
Jarmai et al. 2020). Academic authors of responsible
innovation (RI) literature have argued that RI requires
more than the isolated actions of individual actors and
should include the broader innovation system and its
institutions (Stilgoe et al. 2013). Thapa et al. (2019)
argue that the understanding of RI is compatible with
regional innovation studies and that new insights
could be gained by combining the two strands of litera-
ture. Furthermore, they argue that drivers and barriers
to RI can be applied to regional innovation studies. In
order to deal with these grand challenges in a respon-
sible way, it is important to develop extensive knowl-
edge of how regional industrial development occurs,
as well as to identify the factors that function as support
and barriers.
The economic geography literature claims that
knowledge, competence, norms, and other regional
assets accumulate and strengthen over time, creating
self-reinforcing eects that lead to path dependency
and possibly to lock-in(Grabher 1993; Martin 2010).
Stilgoe et al. (2013) emphasise how the same factors
leading to lock-in and path dependency can create bar-
riers to RI. In this article, we take a broader approach
than lock-in on factors functioning as support and bar-
riers to regional industrial development, as we concep-
tualise these factors as the regional asset base and the use
© 2023 The Author(s). Published by Informa UK Limited, trading as Taylor & Francis Group
This is an Open Access article distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use,
distribution, and reproduction in any medium, provided the original work is properly cited. The terms on which this article has been published allow the posting of the Accepted
Manuscript in a repository by the author(s) or with their consent.
CONTACT Maria Tønnessen Frivold maria.tonnessen@uia.no
Norsk Geogrask TidsskriftNorwegian Journal of Geography
https://doi.org/10.1080/00291951.2023.2192225
of assets in a region. Drawing insights from literature on
sustainability-oriented innovation, Jarmai (2020)nds
that limited personnel and nancial resources can
cause internal barriers in companiesinnovation prac-
tices and that a lack of knowledge, technology, or exter-
nal actors can cause external barriers to innovation.
Furthermore, technological and managerial capabilities,
tangible and intangible assets, and knowledge and skills
are mentioned as drivers of innovation, alongside the
regulatory framework (Jarmai 2020). While Grabher
(1993) focused on immaterial matters as barriers, Jarmai
(2020) mentions both immaterial and material factors.
From this, we see a need to expand the understanding
of factors functioning as support and barriers to inno-
vation beyond social linkages and close networks to
include also material factors. Our conceptualisation
allows for including both material and immaterial fac-
tors that can function as support or barriers to regional
industrial development, and thus to include and sup-
plement Grabhers factors in lock-in (Grabher 1993).
Jarmai (2020) states that when it comes to respon-
sible innovation, all factors have the potential to act as
either support or barriers to innovation, depending on
the situation. The same applies to assets in the regional
innovation system (RIS). The regional asset base devel-
ops over time, creates regional preconditions, and is
often related to traditional ways of doing things,
especially in strong old industrial regions categorised
as thick and specialised RISs (Tödtling & Trippl 2005;
Isaksen & Trippl 2016). Such regions are particularly
vulnerable to industrial decline, as exogenous changes
may be dicult to meet due to a specialised regional
asset base that can be challenging to use for other pur-
poses (Isaksen & Trippl 2016). Thus, the regional asset
base can function both as support and barriers to
regional industrial development, depending on the situ-
ation. Furthermore, Maskell & Malmberg (1999, 10)
argue that regional assets are actively modied or
reconstructed by the deliberate and purposeful action
of individuals and groups within or outside the area.
In other words, regions have an historically developed
asset base (MacKinnon et al. 2019) that can be modied
through agency.
We aim to contribute to a wider understanding of
barriers to regional industrial development by placing
assets centre stage and asking the following overall
theoretical research questions: How can regional assets
function as support and barriers to regional industrial
development? How can actors take steps if regional
assets become a barrier and how can such barriers be
lowered? To investigate these questions empirically,
we conducted empirical investigations in the case
regions of Stavanger and Grenland in Norway, both of
which are characterised as organisationally thick and
specialised RISs (Underthun et al. 2014; Deegan et al.
2021). In the Stavanger region, in the county of Roga-
land, the industry structure is diversifying to become
less dependent on oil and gas and to advance to other
emerging industries (Stavanger kommune n.d.), while
in the Grenland region, in the county of Telemark og
Vestfold, there are aims to make the industry greener,
given that industry in the county as a whole accounts
for over 20% of Norways industrial emissions (Vestfold
og Telemark fylkeskommune n.d.). The following
empirical research questions were addressed in the
case studies:
1. What are historically created key regional assets in
the two specialised regions?
2. Do the assets function as support or barriers to green
path development?
3. If they are barriers, what are key agencies for lower-
ing them?
The remainder of the article is organised as follows.
The theoretical framework is presented in the next sec-
tion, followed by clarication of the research design and
an overview of the case regions. Thereafter, we discuss
the empirical ndings before presenting our con-
clusions regarding the articles theoretical and empirical
contributions, as well as its policy implications.
Theoretical framework
Asset perspective on barriers to regional
industrial development
This article seeks to contribute to a better understanding
of barriers to regional industrial development. We con-
ceptualise regional industrial development through the
notion of path development. Many researchers have
taken on the task of pinpointing factors and dynamics
that enable or constrain regionsability to change
their paths (Martin 2010;Neke et al. 2011; Dawley
2014; Boschma 2015; Grillitsch & Sotarauta 2020; Isak-
sen et al. 2021). Regional actors can contribute to mul-
tiple regional industrial paths, such as path extension,
path upgrading, path diversication, path importation,
and path creation (Martin & Sunley 2006; Hassink
2010; Isaksen & Trippl 2016; Grillitsch et al. 2018;
Trippl et al. 2020).
The types of regions in focus in this article are
characterised by their organisationally thick and special-
ised RISs. Such systems are characterised by one or a few
dominating industries. Isaksen & Trippl (2016) argue
that thick and specialised RISs, usually found in old
2MarenSongeEriksen&MariaTønnessenFrivold
industrial regions, can be overspecialised in mature
industries, which can have reinforcing eects that
strengthen existing industries. Additionally, such
regions are especially exposed to industrial decline
(Isaksen & Trippl 2016). The literature oers insights
into barriers to the development of thick and special-
ised RISs, such as being challenging to move beyond
the existing path to new ones (Isaksen et al. 2018;
Chen & Hassink 2020), and lack of regional leadership
and prevalence of existing patterns (Fløysand et al.
2022), to mention a few. For a recent overview of
barriers to regional industrial path development, see
Kyllingstad (2021). Lastly, Hassink (2017)argues
that within the evolutionary economic geography lit-
erature, the concepts of path dependency and lock-in
are mentioned as the main barriers to industrial
development.
Grabher (1993)rst introduced the concept of lock-
in to explain why the mature clusters in the Ruhr region
in Germany faced a dramatic decline in the 1970s. The
region, with its dominant industry of coal and iron
mining, had until the 1960s been the motor of national
economic development (Grabher 1993, 257). Grabher
(1993, 260) called the phenomenon the rigid specializ-
ation trapand made a distinction between three inter-
related types of lock-in, which captured dierent facets
of the challenges of close ties for industrial develop-
ment. The rst type of lock-in, functional lock-in, points
to how close and stable ties between regional core rms
and suppliers reduce boundary-spanning functions and
undermine the ability to identify and absorb knowledge
from external sources. The second type of lock-in is cog-
nitive lock-in, which refers to how close ties over time
create common norms and world views that can lead
to the disregarding of information that does not align
with existing norms. The third type of lock-in, political
lock-in, occurs when close links between the dominating
industry and both the political and administrative sys-
tems lead to reinforcement and support of the already
strong industry. All types of lock-ins are, from Grab-
hers point of view (Grabher 1993), about the lack of
new knowledge absorbed in a regions strong industries
due to too close linkages and networks between intra-
regional actors. The concept of lock-in is widely estab-
lished, and the literature emphasises that lock-in
situations can be barriers to regional industrial develop-
ment (e.g. Tödtling & Trippl 2004; Hassink 2005;2010;
Hassink & Shin 2005; Hudson 2005; Blažek et al. 2020;
Newey & Coenen 2022). Martin & Sunley (2006)
emphasise that the degree of specialisation and insti-
tutional arrangements is relevant to whether lock-ins
occur, as lock-in can be described as a condition
where endogenous change ceases to evolve.
Consequently, the common understanding of lock-in
includes dense networks, xed norms, and stable formal
institutions.
Since the concept of de-locking was introduced, the
de-locking of regional industry has been discussed by
many authors (Martin & Sunley 2006; Martin 2014;
Hassink 2017). Grabher (1993) suggested a loosening
of closely tied networks to allow for new knowledge to
penetrate the region. Both the understanding of the pro-
blem as having too close linkages and networks and the
proposed solution of loosening the close networks have
been repeated by several authors (Bathelt et al. 2004;
Tödtling & Trippl 2005; Hassink 2010; Trippl et al.
2018).
Researchers have argued for additional insights into
barriers to regional industrial development and to
dierent types of RIS (Kyllingstad 2021). While lock-
in situations due to close networks and linkages are
seen as one type of barrier to regional industrial devel-
opment, we suggest a complementary perspective.
Grabhers approach is mainly concerned with immater-
ial factors (Grabher 1993), but in our framework we
include material factors too. In line with Jarmai
(2020), we argue that assets can function as both sup-
port and barriers to regional industrial development
and that barriers to regional industrial development
can be caused by the regional asset base. We adopt the
following categorisations: natural assets (e.g. including
land, oil wells, and climate), infrastructural and material
assets (e.g. machines, nancial resources and physical
infrastructure), industrial assets (e.g. risk capital and
organisational methods), human assets (e.g. compe-
tence and skills in the labour force), and institutional
assets referring to formal and informal rules and to
the institutional setting (MacKinnon et al. 2019; Maskell
& Malmberg 1999). This categorisation allows us to cap-
ture both the material and immaterial assets. Further-
more, assets are developed over time and shaped by
their surroundings, and they can be described as
regional preconditions for further industrial develop-
ment (MacKinnon et al. 2019). As regional assets are
historically and geographically bound, they can also
become self-reinforcing eects that create barriers to
regional industrial development that extend beyond
the negative eects of close networks, as explained by
Grabher (1993). The regional asset base is often con-
nected to the traditional way of doing things in regions
industries, especially in thick and specialised regions
where one (or more) strong industry is strengthened
by supportive institutional structures. To create new
regional industrial paths or to reorient the established
path, regional assets such as competence, technology,
and rules and regulations need to be identied and
Norsk Geogrask TidsskriftNorwegian Journal of Geography 3
modied through the purposeful actions of individuals
or groups (MacKinnon et al. 2019).
Grabhers perspective highlights social linkages
(Grabher 1993), which we argue is of immaterial quality.
Furthermore, Grabhers observations in the Ruhr region
can be interpreted from the asset perspective (Grabher
1993). The functional lock-in can be understood as an
accumulation of knowledge and skills (human assets)
in a select few rms with strong networks (infrastruc-
tural and material assets) consisting of fellow dominant
rms. In the asset framework, the cognitive and political
lock-ins can be understood as a strong shared culture
(institutional asset) within industry itself and between
industry and policymakers. However, we realise that
Grabhers lock-in concepts are more dynamic than the
classication of assets (Grabher 1993), which is why
we do not claim that that our perspective is an alterna-
tive to Grabhers perspective. By broadening the per-
spective on barriers to regional industrial development
to include assets, we provide a bigger lens through
which to explore what factors (assets) can create barriers
to and provide solutions (asset modication) for
regional industrial development.
Asset modication and agency
Based on the argument that assets can become barriers
to industrial development, we argue that asset modi-
cation is needed to lower such barriers and to contribute
to industrial development. Asset modication is a cor-
nerstone of regional industrial development (Chen
2021), as changes in a regions structure, development,
and institutions are dependent on changes in the
regional asset base. However, some assets are harder
to modify than others, depending on the type of asset
and whether it is an organisational-level or system-
level asset. Most natural assets are given conditions
that are hard to change, while industrial or human assets
are more easily changed. Also, the exploitation of dier-
ent types of assets is impacted dierently by the legisla-
tive framework and policies. For example, in the
Norwegian context, the exploitation of human assets is
regulated by the Working Environment Act of 2005
(Lovdata 2022) and the Norwegian tripartite
cooperation model (Arbeids- og inkluderingsdeparte-
mentet 2021). Following Isaksen et al. (2020), we
make the distinction between organisational-level and
system-level assets to emphasise how not all assets are
tied to the same actors and that actors aect assets in
dierent ways. For example, the Norwegian government
is limited in controlling what technology local rms use,
while rms might be limited in their exploitation of
natural assets, as they (the rms) are often owned and
controlled by the state. System-level actors, like govern-
ments, have the power to form legislative framework
conditions and policies to which rm-level actors
must adapt. This notion supports the argument that
asset modication occurs on several levels. In this
article, both organisational-level and system-level assets
are included in the regional asset base. Thus asset
modication is the key to understanding the develop-
ment of new regional industrial paths (Isaksen et al.
2020; Trippl et al. 2020).
The lowering of barriers to regional industrial
developmentthroughassetmodication can occur in
three ways, namely through asset reuse, asset creation,
or asset destruction. Asset reuse is a process in which
existing assets are redeployed or recombined for new
purposes (Rypestøl et al. 2021). This can occur at the
organisational level by, for example, using technol-
ogies for reasons other than their original purpose,
or it can occur at the system level when new academic
disciplines are introduced to a eld (Kyllingstad et al.
2021). Asset creation entails the creation of entirely
new assets to a region or rm through importation
or internal development (Rypestøl et al. 2021). Asset
destruction is the process of terminating assets that
hamper future development, which can occur through
the destruction of outdated technologies (Isaksen et al.
2020). This can also include the unlearning of routines
in an organisation or the more drastic move of
shutting down businesses or terminating support
programmes.
However, assets do not change by themselves. The
modication of assets to lower barriers to development
requires purposeful actions by actors. The literature
mentions several dierent types of agency. Grillitsch &
Sotarauta (2020) identify change agency as the main dri-
ver of regional structural change, whereas Bækkelund
(2021) argues that reproductive agency is necessary for
path evolution. We distinguish between change agency
and reproductive agency in this article, as the two
types of agency present the intentions behind modifying
assets either to produce change or to keep assets more or
less unaltered in order to seek stability or avoid change.
Furthermore, Isaksen et al. (2020) specify how change
agency can be found on both the organisational and sys-
tem levels and that asset modication processes on the
two levels of agency need to be aligned to achieve the
intended outcome. The agency performed by actors
on the two dierent levels will impact assets dierently
in terms of both types and scale (Isaksen et al. 2020;
Rypestøl et al. 2021). Additionally, there are three sys-
temic levels regional, national, and international
in which this perception also applies. Barriers to indus-
trial development can be lowered if agency on the
4MarenSongeEriksen&MariaTønnessenFrivold
organisational and system levels are aligned in modify-
ing assets. For example, to build competence (i.e. the
creation of human assets), change agency at the national
level must grant funding for new educational pro-
grammes, whereas change agency at the regional level
needs to establish arrangements for internships, and at
the organisational level, educational institutions need
to design and arrange their programme, as well as to
recruit teachers and students. To develop physical infra-
structure (i.e. infrastructural and material assets),
change agency at the organisational level must specify
its needs, and change agency at the regional level must
promote this on behalf of the industry to the national
level, where most funding and decision-making take
place. However, the lowering of barriers can be pre-
vented by reproductive agency, for example if it occurs
at the national level with the power to overrule regional
initiatives. Overall, several types of assets can create bar-
riers to regional industrial development, and in such
cases there would be a need for the creation of new
assets, reuse of existing assets, and/or destruction of
hampering assets to lower the barriers.
Context and research design
The empirical cases in this article strive to achieve a
greener industry. Therefore, we investigate how assets
can function as support or barriers to development
processes, as well as how asset modication through
change agency can lower any barriers. Both regions
include thick and specialised RISs characterised by either
one dominant industry or a few dominant industries.
Isaksen & Trippl (2016) argue that thick and specialised
RISs, usually found in old industrial regions, can be
overspecialised in mature industries, which can have
reinforcing eects that strengthen existing industries.
Additionally, such regions are especially exposed to
industrial decline (Isaksen & Trippl 2016). Regions heav-
ily dependent on carbon-intensive sectors might
especially struggle to ensure responsible and just tran-
sitions to greener industry, as fast downsizing of jobs
in carbon-intensive sectors will aect some social groups
more than others (Afewerki & Karlsen 2022).
The two regions analysed, Stavanger and Grenland,
are located on the southern coast of Norway (Fig. 1).
The oil and gas sector, which is dominant in Stavanger,
has been through several crises, and both the sector and
regional actors in the Stavanger region are on a mission
to diversify into more industries, such as aquaculture
and renewable energy. The metal and cement proces-
sing industry in Grenland is not currently experiencing
a demand-side shortage, but the products and processes
need to be more sustainable than they have been in the
past in order to maintain and strengthen competitive-
ness. The two cases were chosen because of the eorts
within them to transition regional industries. Stavanger
is dedicated to diversifying the industry structure,
whereas Grenland is working towards strengthening
the existing industry structure with a greener and
more sustainable focus. As the two case regions have
dierent goals regarding regional industrial develop-
ment, the study does not follow a matched pair design,
Fig. 1. Location of the Stavanger region and Grenland region in Norway
Norsk Geogrask TidsskriftNorwegian Journal of Geography 5
but rather draws on two parallel single cases (Sotarauta
& Suvinen 2019).
The Stavanger region
The Stavanger region is located on the south-west coast
of Norway and is known as the oil capital of Norway. In
line with the housing and labour market regions formed
by Gundersen et al. (2019), we dene the Stavanger
region as the economic region of the municipalities of
Stavanger, Sandnes, Sola, Randaberg, Hå, Time, Klepp,
Gjesdal, Strand, and Kvitsøy, all of which are in the
county of Rogaland. In 2020, the region had a popu-
lation of c.347,000; Stavanger, the largest municipality,
had a population of 144,147, followed by Sandnes with
80,450 (Statistics Norway n.d.).
Over several decades, the region has increasingly
become more specialised towards the oil and gas sector
(Deegan et al. 2021). Big oil rms (e.g. Equinor), cluster
organisations, and governmental bodies in the pet-
roleum industry have their headquarters in Stavanger.
While petroleum is the dominant industry, the region
hosts other industries, such as aquaculture, agriculture,
and tourism. Still, uctuations in oil and gas prices have
led to mass lay-os several times, which have fostered
growing concerns about the safety of jobs in the region
and the need for a more diversied industry structure
and labour market. As part of its strategy for industrial
development, Stavanger Municipality species other
industries (i.e. besides oil and gas), namely aquaculture,
agriculture, and tourism, alongside renewable energy, as
focus areas towards 2030 (Stavanger kommune n.d.).
The aim of diversifying the regions industry structure
is shared by Rogaland County as a whole and by Stavan-
ger Chamber of Commerce in particular.
The Grenland region
One of the biggest manufacturing industry regions in
Norway, measured by the number of jobs, is the Gren-
land region (Flatval et al. 2020) in south-eastern Nor-
way. The Grenland region includes the municipalities
of Porsgrunn, Skien, Bamble, Siljan, Nome, and Dran-
gedal, all of which are currently in the county of Tele-
mark og Vestfold (Gundersen et al. 2019). According
to Statistics Norway (n.d.), the region had a population
of about 118,500 in 2021. The largest municipality in
terms of population is Skien, with c.55,000 people (Stat-
istics Norway n.d.). Together, Skien and Porsgrunn,
have the most workplaces in the region. The region pos-
sesses Norways largest concentration of process
industries, primarily petrochemicals, metal, and cement.
The products and services produced in the region will
be important in the future, but industrial activities in
the county of Vestfold og Telemark as a whole already
release over 20% of Norways industrial emissions
(Vestfold og Telemark fylkeskommune n.d.). Because
of this, the Industrial Green Tech (IGT) cluster was
established in 2018 to develop, test, and build new
smart technology and ecient solutions for the industry
and the circular economy.
1
The overall vision in Grenland is for the region to
become the worldsrst climate-positive industrial
region. Furthermore, this vision is important for keep-
ing companies in the region, as well as attracting new
ones to ensure that there are workplaces in the future.
Research design
In line with the work of Yin (2013), the research design
of the study on which this article is based followed a case
study approach. Moreover, as mentioned in the section
Context and research design, in this article we draw on
Sotarauta & Suvinen (2019) by applying two parallel
single cases, rather than a comparative case study of
two regions or a matched-pair design, the reason
being that our two case regions dier in industry struc-
ture and type of path development, as we focus on diver-
sication in Stavanger and greening in Grenland.
Drawing on insights from two dierent regions, we
aim to provide a more thorough analysis, with two con-
texts and two sets of experiences related to regional
industrial development.
Primary data were applied, as well as secondary data
in the form of newspaper articles, company and muni-
cipality websites, and municipalitiesstrategic industrial
plans. This was done to obtain relevant information
about the regions and their ongoing development pro-
cesses. Primary data were collected from in-depth
semi-structured interviews. The use of semi-structured
interviews is a well-known approach to gain insights
into complex phenomena (Welch et al. 2011; Yin
2013), and the interviews enabled us to follow interest-
ing leads with in-depth queries. In total, 30 interviews
were conducted, 15 in each case region. The intervie-
wees included company managers, cluster leaders, and
municipal representatives, both administrative and pol-
itical. Interviewing representatives of both the private
and public sectors was important in order to gain a
comprehensive understanding of how the regions
worked with their respective regional industrial devel-
opment processes, what were the central assets in the
1
In 2022, the Industrial Green Tech (IGT) cluster was incorporated into the technology and industry cluster named Powered by Telemark.
6MarenSongeEriksen&MariaTønnessenFrivold
regions and who were important actors. Most interviews
lasted c.60 minutes, in accordance with recommended
qualitative research practice (Gioia et al. 2013), and
they were recorded and transcribed with consent from
the interviewees, except for ve interviews, for which
we relied on notes. Most of the interviews were done
in person (21), but due to COVID-19 restrictions,
some interviews were conducted electronically (9).
The data were sorted manually, in line with relevant cat-
egories extracted from the theoretical framework, and
they were analysed accordingly. An overview of the
interviewees and the timeline of the interviews is
shown in Table 1.
Findings and analysis
The Stavanger region
Key regional assets
For centuries, the Stavanger region has been inuenced
by the sea. In the 1800s, the region thrived on sailing
vessels and herring shing before the canning industry
took over in the rst half of the 20th century. Since
then, infrastructural and material assets have been
built at favourable places along the edges of the fjords
and along the coastline, to support activity at sea. The
knowledge of how to operate at sea has spread
throughout generations and has become part of the
human assets in the region. At the start of the 1960s,
the oil and gas sector was established (Ministry of Pet-
roleum and Energy 2021). Since then, the oil and gas
sector has dominated the region, despite several crises.
Thus, since the 1960s, the Stavanger region has built
even more infrastructure and technology around
oshore activity and the extraction of oil and gas.
An overview of the assets mentioned by our intervie-
wees is provide in Table 2. The assets mentioned in
the categories of infrastructural and material assets,
human assets, and institutional assets were emphasised
most, and consequently we chose to focus on them as
our key assets.
The geographical location of the region makes it well
suited as a base for transportation between the Norwe-
gian continental shelf and the mainland, and thus to
Table 1. Overview of interviewees
Time
Stavanger Grenland
Type of interviewees Interviewee code Type of interviewees Interviewee code
September 2021 Company manager G1
Cluster representative G2a
Cluster representative G2b
Municipal representative G3
October 2021 Cluster representative S1 Company manager G4
Municipal representative S2 County representative G5
Cluster representative S3 Company manager G6
Chamber of Commerce representative S4 Company manager G7
Cluster representative S5 Company manager G8
Municipal representative S6 Company manager G9
Cluster representative S7 Municipal representative G10
Company manager S8 Municipal representative G11
Cluster representative S9 Company manager G12
Company project leader S10 Company manager G13
Company manager S11 Company manager G14
Company manager S12
Company manager S13
November 2021 Company manager S14 Company manager G15
Company manager S15
Table 2. Regional assets in Stavanger
Asset categorisation based on the work by Maskell
& Malmberg (1999) Empirical ndings from Stavanger
Natural assets Land for farming and grazing animals, landmarks and hiking trails, shoreline/fjord/sea/waves, proximity
to the Norwegian continental shelf, wind, renewable energy
Infrastructural and material assets Marine logistics, nancial resources, test facilities, shared oce buildings, innovation park, documents,
machines and facilities close to the sea, advanced construction machines, close proximity to decision-
makers (e.g. to the Ministry of Petroleum and Energy), access to renewable energy
Industrial assets Industry-specic (especially oil & gas, and marine) technology), organisational structures
Human assets Educated/skilled workforce, people and knowledge,ery souls(passionate individuals), industry-
specic(oshore and marine) competence and technological competence
Institutional assets We can do thisattitude, proximity to decision-makers, networks/social linkages between national
decision-makers (e.g. the Ministry of Petroleum and Energy) and regional decision-makers and industry,
supportive institutional arrangements (e.g. Innovation Norway and the Research Council of Norway)
Norsk Geogrask TidsskriftNorwegian Journal of Geography 7
become a solid base for the development of a broad ser-
vice and supplier industry. In addition to the infrastruc-
tural and material assets in the region, key assets are
competence relating to oshore operations, the oil and
gas market, and sector-specic legal arrangements,
including the development and maintenance of technol-
ogy over many years. The emergence of the oil and gas
sector has been endorsed by national policies, such as
those concerning taxation, as well as regional policies
aimed at stimulating research institutes and educational
institutions to support the oil and gas sector (Norwegian
Petroleum 2023a;2023b).
Assets functioning as support and barriers in the
Stavanger region
The ongoing development process in the Stavanger
region mainly deals with diversifying the region through
the development of other industries in addition to the
oil and gas sector. This also involves more responsible
innovation activities to develop greener industries com-
pared with the oil and gas sector. The regions depen-
dence on oil and gas has made it especially vulnerable
to market uctuations. A recent example was the nan-
cial and oil crisis in 2014, when the unemployment rate
in the Stavanger region increased rapidly and reached a
peak of 4.6% in 2016, 1.4 percentage points over the
national average (Lima 2016). Many of our interviewees
pointed to the 2014 crisis as a turning point for many
actors in the region nally to taking action towards a
green shift. Additionally, our interviewees claimed that
since the oil and gas sector was protable and oered
Norways highest average monthly salary of all indus-
trial sectors, it was dicult to move away from such a
sector: our problem is that we have an oil and gas sector
that is willing to pay(S8). In the aftermath of the 2014
crisis, rms started dierentiating and pursuing other
markets towards more sustainable options, as they
realised prots from oil and gas production could be
vulnerable and are not compatible with the worldview
of a future with low emissions and renewable energy
in accordance with the UNs Sustainable Development
Goals (United Nations n.d.). According to one intervie-
wee, the green shift has hit more seriously this time
around. [] It is a shift here now that is much more
fundamental than it has been previously(S5).
In the Stavanger region, we observed several
examples of assets functioning as support for green
path development, whereby industries, especially mari-
time industries, reused infrastructural and material
assets for new purposes to become less dependent on
the oil and gas sector. Through our interviews, we ident-
ied a tendency for companies in the oil and gas service
industry to shift away from the oil and gas market alone
and to other oshore and maritime industries where
they could use the infrastructure, technology, and com-
petence they already possessed: we see that some of the
green companies are locating here, and according to
them they come here because of the competence(S6).
However, strong and specialised competence in the
oil and gas sector is not solely an advantage for the Sta-
vanger region. Some interviewees identied challenges
related to how high wages in the oil and gas sector
exhausted the labour market of skilled workers with
technological competence, leaving few competent
workers for other, relatively smaller industries: It [the
oil sector] is a sponge when it comes to competence
(S12). High wages are the result of a combination of sev-
eral assets. The access to valuable natural assets (oil and
gas), combined with the competence (human assets),
technology (industrial assets) and machines and infra-
structure (infrastructural and material assets) to extract
and exploit the natural assets, as well as supportive insti-
tutional arrangements (institutional assets), have
resulted in high prots for the sector. This has been ben-
ecial to obtain and maintain the necessary competence
in the rms and to develop the oil and gas sector.
High prots, materialised through high wages, aect
access to human assets in the form of skilled workers. As
a result, high wages create a barrier to the transference
of skilled workers (i.e. human assets) from the oil and
gas sector to other emerging industries, which in turn
creates a barrier to further regional industrial develop-
ment in the region. New emerging industries, such as
aquaculture, especially lack the economic muscle to
compete with companies in the highly protable oil
and gas sector. When the oil price is steady, the oil
and gas sector has a vacuum eecton the labour mar-
ket by sweeping up the market of skilled workers (Dee-
gan et al. 2021). When the oil price falls, as in 2014,
people are laid oand skilled workers become available
for other industries. Depending on the oil price, access
to certain types of skilled workers is limited for indus-
tries outside the oil and gas sector and is thus a barrier
to the development of those industries. As the growth of
alternative industries is part of the diversication strat-
egy of the region (Stavanger kommune n.d.), the high
prots from the oil and gas sector materialised through
high wages have also become a barrier to regional indus-
trial development.
In the past, economic crises impacted the protability
of the oil and gas sector, which led to dismissals and the
relocation of human assets. When the COVID-19 pan-
demic hit Norway in 2020, this could potentially have
been a similar scenario. However, the Norwegian gov-
ernment formed a crisis package for the oil and gas sec-
tor to prevent dismissals and stimulate predictability for
8MarenSongeEriksen&MariaTønnessenFrivold
the industry: Last year we had a combination of a pan-
demic and an oil price at twenty dollars [USD] a barrel,
which was critical, and without that oil package from
the government in June we would have seen mass dis-
missals in the industry(S4). Given the challenge of
high wages and competence being vacuumed by the
oil and gas sector, dismissals from the oil and gas sector
could potentially have led to the release of competence,
which in turn could have become available to alternative
industries in the region. Several interviewees expressed
their opinion of what could stimulate further develop-
ment, namely that the region needed lower oil prices
and the subsequent release of competence from the sec-
tor for the newer industries to grow. In other words, the
Norwegian government has prevented the potential
scenario of reusing human assets by its actions to stabil-
ise the labour market. The national government per-
formed reproductive agency by doing so and thus
prevented change. Even if sudden mass dismissals in a
dominant industry might release human assets, it is
not certain that alternative industries have appropriate
jobs available at the same time. The region could risk
losing valuable competence if alternative industries
were unable to absorb the released assets.
The Grenland region
Key regional assets
Grenland has hosted Norways largest concentration of
processing industries, dating back to the early 1900s
(Hodne & Grytten 2002), when Norsk Hydro was estab-
lished; Norsk Hydro later and became the leading com-
pany in the production of fertilizer, as well as
aluminium and magnesium (Hydro 2023). Today,
Norsk Hydro is no longer the same, as it has been
split up into c.90 dierent companies. Many of these
companies are still located in Grenland and are primar-
ily in the petrochemicals, metals, and cement industries.
Since Hydros glory days, a strong infrastructure has
developed in Grenland, which we understand as an
infrastructural and material asset. The companies
located in the region, are connected by a strong infra-
structure, such as a pipeline that covers all of Herøya
Industrial Park, in the city of Porsgrunn, access to the
power grid, water, quays, and logistics. One company
interviewee expressed that the Grenland industry had
the advantage of being highly integrated. For example,
Company X uses steam from Company Y in its factory,
and Company Y uses fuel gas from Company Z in its
processes. In other words, The industry has developed
a functioning ecosystem(G2b). This cooperation has
in turn led to easy access to workers and the right com-
petence (i.e. human assets). Throughout generations,
people have worked in the same companies as their
neighbours and family members, and they have gained
knowledge of how many of the companies in the region
operate, making it easy for them to help other compa-
nies during projects or if crises occur.
The local companies are in an industry that releases
heavy gas emissions, and consequently the Grenland
region has struggled for a long time with being dirty.
As mentioned in the Introduction and the section
The Grenland Region, over 20% of Norways gas emis-
sions from the manufacturing industry (mainly process
manufacturing) come from the county of Vestvold og
Telemark as a whole (Vestfold og Telemark fylkeskom-
mune n.d.). This had severe consequences for the region
in the 1960s and 1970s, but since then eorts have been
made to improved the situation. Frierfjorden, in Gren-
land, was once one of the worlds most polluted fjords,
and the main water channel was so polluted that an
interviewee revealed that it was not possible to swim
or sh in it: so the manufacturing industry denitely
left its mark on the area(G11). However, the industry
has made changes to its processes and products over
many years towards being more environmentally
friendly, including having more responsible innovation
activity (Enova 2021; Yara International 2021; Green
Industry Cluster, Norway n.d.). A shift culture among
workers (i.e. an institutional asset) has emerged over
the century (i.e. since the 1920s) and is highlighted as
one of the most important assets in the region. One of
the latest initiatives came from the former cluster,
Industrial Green Tech, which mobilised its members
towards aiming to become the worldsrst climate-posi-
tive industrial region. Since the 1970s, the conditions
have ameliorated, and several of the company intervie-
wees argued that this problem had been on the indus-
trys agenda for decades.
An overview of the empirical ndings related to the
dierent assets in Grenland is provided in Table 3.
Overall, the regional asset base has a strong presence
of infrastructural and material assets, human assets,
and institutional assets, which are oriented towards
the production of petrochemicals, cement, and metals,
as highlighted by our interviewees. Therefore, in the
next subsection, we choose to focus on these as key
regional assets.
Assets functioning as support and barriers in
Grenland
An examination of the central assets in Grenland and
their potential to function as support or barriers to
regional industrial development needs to be seen in
light of the direction of the development process.
According to the interviewees, stakeholders in Grenland
Norsk Geogrask TidsskriftNorwegian Journal of Geography 9
have expressed they have no intention of changing its
industry structure; rather, they want to strengthen it
by becoming greener and reducing emissions.
Additionally, we identify many examples of assets
functioning as support for the greening of the industry
through asset reuse in Grenland. For example, many
companies reuse part of their old production processes,
especially industrial assets and infrastructural and
material assets, while replacing fossil fues or dirty com-
ponents, often natural assets, with greener and cleaner
options. The cited examples are often based on common
initiatives and projects set in motion by several industry
actors, such as Herøya Industrial Park and the IGT clus-
ter. Furthermore, the interviews revealed that the shift
culture and strong unity between the industrial actors,
understood as an institutional asset, have been impor-
tant in initiating and developing green development
projects in the region and thus can be interpreted as
asset reuse.
Furthermore, there are examples of asset creation in
Grenland, specically through a project related to car-
bon capture and storage (CCS). Capturing and storing
the large CO
2
emissions from the industry at Herøya
Industrial Park is a vital part of the mission to become
climate positive. The project involves the creation of a
new facility where the capture and storage of carbon
can take place. However, this will require much electri-
cal power.
One important piece of the puzzle for Grenland and
Herøya Industrial Park in the mission for the region to
become the worldsrst climate-positive industrial
region is an infrastructural and material asset, namely
the power grid. This was mentioned in almost all our
interviews, and we see it as a vital part of the regional
industrial development process and as a barrier to
greening. Many companies require increasingly more
power to electrify their production processes. The
expansion of the power grid (i.e. asset creation) is there-
fore an important issue. The upgrading of the power
grid is controlled by Statnett, which is owned by the
Norwegian state, and governed by the Ministry of Pet-
roleum and Energy, and is the system operator respon-
sible for development and operation of the power grid
in Norway (Statnett n.d.). Being a public-owned organ-
isation, Statnett is required to conduct internal pro-
cesses that support and follow democratic principles,
resulting in bureaucratic processes and long case-
processing times. According to Statnetts priorities,
Herøya Industrial Park will have its energy supply
ready in 2030 at the earliest (Statnett 2021).
There is clearly a dierence in the timeline for when
the power capacity will be available and when it is
needed. Statnett is part of projects related to the green-
ing of the industry at Herøya Industrial Park, but it has
prevented changes, at least in the short term. As the
owner of the power grid, Statnett has total control
over its use and management, which means that Statnett
needs to consider all industrial and other needs for elec-
trication, such as potential battery factories and data
centres.
Although expansion of the power grid is on Statnetts
agenda, representatives of companies in Grenland
expressed that their companies did not feel that they
were high on Statnetts priority list, which hampered
the process of realising the regions vision: industrial
development is hampered due to limited line capacity
(G8). The industry, as it seeks to perform change agency
with its mission and initiatives to become part of the
worldsrst climate-positive industrial region, does not
receive any special privileges in the race for power
lines. Even if it is not Statnetts intention to slow down
the process of Grenland becoming greener, it is a conse-
quence of the procedures Statnett needs to obey; thus,
Statnett performs reproductive agency. While the com-
panies in the region can take initiative towards green
development processes at a rm level, they are limited
by infrastructural and material assets controlled by a sys-
tem-level actor. System-level agency is necessary to mod-
ify the infrastructure that is crucial for the rm-level
actors. This exemplies the need for alignment between
Table 3. Regional assets in Grenland
Asset categorisation based on Maskell &
Malmberg (1999) Empirical ndings from Grenland
Natural assets Water (cooling and fresh water), coastline, hydropower
Infrastructural and material assets Logistics, a hub of infrastructure, docks, power lines, close proximity between companies, shared pipelines, a
mature industrial area, roads
Industrial assets Industry-specic technology (electrolyte, process industry, cement, energy), organisational methods, sharing of
technologies, electrication
Human assets Industry-specic competence (process industry), knowledge, skilled workers, cluster, good connections to local
university and research institutes, knowledge sharing, process operators
Institutional assets Shift culture, strong industrial environment, development processes in the regions DNA, politics, strong
common industry initiative for change, population is used to a dominating industry, workforce is used to
helping out at short notice, collaboration between private and public actors, supportive institutional
arrangements (e.g. Innovation Norway and the Research Council of Norway)
10 MarenSongeEriksen&MariaTønnessenFrivold
agency on dierent levels (Isaksen et al. 2020). Addition-
ally, to achieve asset creation regarding the power
gird, asset modication is also necessary in terms of the
institutional assets concerning how and what Statnett
can do.
Discussion
This article contributes to the literature on regional
industrial development by extending the understanding
of barriers to regional industrial development beyond
the immaterial factors found in the lock-in concept
originating from the work of Grabher (1993) to include
also material factors conceptualised as the regional asset
base. To investigate the relevance of this broader under-
standing, we asked the following questions: How can
regional assets function as support and barriers to
regional industrial development? and How can actors
take steps if regional assets become barriers, and how
can such barriers be lowered? Historically, regional
asset bases were created to support the further develop-
ment of key regional industries. While an asset base sup-
ports the already established and strong industries in a
region, it can also function as a barrier to the transform-
ation of regional industry, such as towards greener pro-
duction processes and the establishment of new
industries in a region. Such barriers can be lowered
though asset modication, either in a fairly simple
way through the reuse and recombination of historically
created material and immaterial assets at the rm-level
and regional-level assets, or in a more demanding way
by creating new assets in rms and at the regional
level, and possibly by destroying hampering assets.
The case regions of Stavanger and Grenland in Nor-
way have been used as empirical settings to investigate
three interlinked questions: (1) What are historically
created key regional assets in the two specialised
regions? (2) Do these assets function as support or bar-
riers to green path development? and (3) If they are bar-
riers, what are the key agencies for lowering them?
Regarding key regional assets, we see similar traits in
both case regions, with a regional asset base specialised
towards the respective regional industries, with infra-
structural and material assets, human assets, and insti-
tutional assets as the most emphasised asset types in
our data. In both regions, we see examples of assets
functioning as support through asset modication,
especially through the reuse of infrastructural and
material assets. We also see examples of assets becoming
barriers to industrial development in both regions.
The reuse of human assets in industries outside the
oil and gas sector is a prominent challenge in Stavanger,
as the oil and gas sector has swept up the labour market
of skilled workers. This nding is in line with Jarmais
claim that limited access to competence and nancial
resources can be barriers to innovation, both inside
and outside the rm (Jarmai 2020). In other words,
this issue is not solely a rm problem but an overarching
and systemic one that demands that actors at both levels
perform change agency. To lower this barrier regarding
high wages, change agency at the system level, such as
the national and regional level, is needed to enable
still further the reuse of human assets in the region.
Companies within emerging industries can perform
change agency at the rm level to boost the attractivity
of their company. However, to make bigger changes,
institutional changes by actors at the national and
regional level will be required, such as through the
wage determination system or policies targeting emer-
ging industries.
The most prominent barriers in Grenland are the
limitations in infrastructural and material assets, mainly
related to the supply of much more electrical power and
the lack of asset creation in that regard due to insti-
tutional assets. Similar to the Stavanger region, asset
modication through change agency is also required
at dierent geographical levels in the Grenland region
to lower that barrier. Projects initiated by companies
located in Grenland can be done through change agency
at the regional level. Some of these projects, such as CCS
projects, are regional, national, and international pro-
jects that require aligned change agency at multiple
levels. When it comes to the issue of extending the
power lines, this is a challenge that requires change
agency at the system level in general, and more speci-
cally at the national level, meaning governmental bodies
such as the Ministry of Petroleum and Energy and Stat-
nett. Asset modication, such as asset creation, is a
potential solution in which new procedures and rules
are created to suit the processing industrys needs better.
Conclusions
In resembling the work of Grabher (1993) and Martin &
Sunley (2006), our study shows that assets that were pre-
viously strengths for the case regions have since become
weaknesses. Additionally, our ndings show that both
immaterial and material factors impact regional indus-
trial development. The asset perspective on barriers to
regional industrial development presented in this article
provides a useful framework for understanding barriers
to industrial transformation and how such barriers can
be lowered. Assets from the regional asset base in thick
and specialised regions can function both as support
and barriers to innovation and regional industrial devel-
opment. Actors at the rm and system levels have
Norsk Geogrask TidsskriftNorwegian Journal of Geography 11
varying impacts on dierent assets and are limited in
what assets they impact and how they impact them.
As such, some assets functioning as barriers can be low-
ered through rm-level agency, while others need sys-
tem-level agency to be lowered; in some cases, both
levels of agency must be aligned. This is perhaps even
more important when the assets functioning as barriers
are natural resources, infrastructure, or institutional
framework, as these types of assets are often governed
by system-level actors.
In short, the asset perspective highlights additional
conditions aecting a regions industry and in society
in general rather than Grabhers lock-in approach as
possible barriers (Grabher 1993). Connecting asset
modication at rm and system levels, as well as change
agency at dierent levels, such as regional, national, and
international, provides a more dynamic point of view
regarding how barriers can be lowered. Moreover, the
asset perspective provides greater opportunities to con-
nect barriers, lowering them to actions on dierent geo-
graphical levels. Consequently, this article is an
important contribution to the understanding of barriers
to regional industrial development.
Acknowledgements
We would like to thank Arne Isaksen, Bjørn Terje Asheim,
and two anonymous reviewers for constructive comments
on earlier versions of this article.
ORCID
Maren Songe Eriksen http://orcid.org/0000-0002-7758-
8880
Maria Tønnessen Frivold http://orcid.org/0000-0003-3679-
3957
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14 MarenSongeEriksen&MariaTønnessenFrivold
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