A Dynamical Model of the Industrial Economy of the Humber Region

TL;DR

This paper develops a dynamical model to analyze how the Humber region's industrial economy might transition from oil refining to bio-based industries, highlighting potential shifts in dominant sectors and economic impacts.

Contribution

It introduces a novel abstract dynamical model for regional industrial interactions and applies it to predict economic transitions in the Humber region.

Findings

Oil refining may decline as bioethanol and biological chemicals grow.

Anaerobic digestion could become a major electricity source.

Regional waste and farming sectors may increase in value.

Abstract

The Humber region in the UK is a large and diverse industrial area centred around oil refining, chemical industries and energy production. However there is currently a desire to see the region transition towards a more bio-based economy. New bio-related industries are being situated in the region as a consequence of policy and economic incentives. Many of these industries are connected through their supply chains, either directly, or by sharing common suppliers or customers and the growth or decline of one industry can hence have impacts on many others. Therefore an important question to consider is what effect this movement towards bio-based industry will actually have on the regional economy as a whole. In this paper we develop a general abstract dynamical model for the metabolic interactions of firms or industries. This dynamical model has been applied to the Humber region in order to gain a deeper understanding of how the region may develop. The model suggests that the transition to a bio-based economy will occur with oil refining losing its dominance to bioethanol production and biological chemical production, whilst anaerobic digestion grows as a major source of electricity, in turn driving up the value of regional waste aggregators and arable farming in the overall economy.