Skip to main content
SpringerLink
Log in

The Economy of the Arctic

  • Chapter
  • First Online:
The Palgrave Handbook of Arctic Policy and Politics

  • 2059 Accesses

Abstract

The Arctic economy is comprised of a broad range of local, regional, and national economies in highly diverse settings. These economies exhibit broad variations in terms of both natural and human resources, as well as in their economic structure and capacities, employment and role of private and public actors, and the range and importance of the issues and challenges they face. At the same time, they have many distinct features in common, some of which are structural in nature and may impede or challenge future economic development at various levels and scales. The dominant components of the Arctic economy include formal (market-based), traditional (subsistence), and transfer (public) sectors. Although the Arctic economy is increasingly shaped by events, decisions, and activities happening elsewhere, with the future of the Arctic influenced by non-Arctic regional, social, political, and economic interests, Arctic regions and communities are taking steps toward positioning themselves to tackle the challenges of economic development and embarking on fostering alternative, locally embedded economic activities. These activities focus on arts and crafts, tourism, small-scale manufacturing, and North-specific technological innovation, as well as address the coupling of traditional, market-based, and public and transfer economies. It also includes seeking new institutional arrangements that leave more control in the hands of local communities—ways forward that appear to signal a changing balance of power.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 149.00
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 199.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD 199.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

References

  • Aarsæther, N., ed. 2004. Innovations in the Nordic Periphery. Stockholm: Nordregio.

    Google Scholar 

  • Aarsæther, N., L. Riabova, and J.O. Bærenholdt. 2004. Community Viability. In Arctic Human Development Report (AHDR), 139–154. Akureyri: Stefansson Arctic Institute.

    Google Scholar 

  • Acs, Z.J., and D.B. Audretsch. 1989. Patents as a Measure of Innovative Activity. Kyklos 4 (1989): 171–180.

    Article  Google Scholar 

  • Andersen, T.M. 2015. The Greenlandic Economy – Structure and Prospects. Economics Working Papers, 2015–14, Department of Economics and Business Economics, Aarhus University.

    Google Scholar 

  • Aslaksen, I., S. Glomsrod, and G. Duhaime. 2015. ECONOR-The Economy of the North 2015. Statistics Greenland.

    Google Scholar 

  • Beyers, W., and D. Lindahl. 2001. Lone Eagles and High Flyers in Rural Producer Services. Rural Development Perspectives 11 (3): 2–10.

    Google Scholar 

  • Bjørst, L.R. 2017. Uranium: The Road to “Economic Self-Sustainability for Greenland”? Changing Uranium-Positions in Greenlandic Politics.

    Google Scholar 

  • Boschma, R.A. 2005. Social Capital and Regional Development: An Empirical Analysis of the Third Italy. In Learning from Clusters: A Critical Assessment from an Economic-Geographical Perspective, ed. R.A. Boschma and R.C. Kloosterman, 139–168. Dordrecht: Springer.

    Chapter  Google Scholar 

  • Bourne, L. S. (2000). Living on the edge: conditions of marginality in the Canadian urban system. In Developing Frontier Cities (pp. 77-97). Springer, Dordrecht.

    Google Scholar 

  • BurnSilver, S., J. Magdanz, R. Stotts, M. Berman, and G. Kofinas. 2016. Are Mixed Economies Persistent or Transitional? Evidence Using Social Networks from Arctic Alaska. American Anthropologist 118 (1): 121–129.

    Article  Google Scholar 

  • Duhaime, G. 2004. Economic Systems. In Arctic Human Development Report, 69–84. Akureyri: Stefansson Arctic Institute.

    Google Scholar 

  • Duhaime, G., and A. Caron. 2008. Economic and Social Conditions of Arctic Regions. In The Economy of the North 2008, ed. S. Glomsrød and I. Aslaksen. Oslo: Statistics Norway.

    Google Scholar 

  • Duhaime, G., A. Caron, S. Lévesque, A. Lemelin, I. Mäenpää, O. Nigai, and V. Robichaud. 2017. Social and Economic Inequalities in the Circumpolar Arctic. In The Economy of the North 2015, ed. S. Solveig Glomsrød, G. Duhaime, and I. Aslaksen. Oslo: Statistics Norway.

    Google Scholar 

  • Eilmsteiner-Saxinger, G. 2011. ‘We Feed the Nation’: Benefits and Challenges of Simultaneous Use of Resident and Long-Distance Commuting Labour in Russia’s Northern Hydrocarbon Industry. The Journal of Contemporary Issues in Business and Government 17 (1): 53.

    Google Scholar 

  • Feldman, M.P. 2000. Location and Innovation: The New Economic Geography of Innovation, Spillovers, and Agglomeration. The Oxford Handbook of Economic Geography 1: 373–394.

    Google Scholar 

  • Fidler, C. 2009. Increasing the Sustainability of a Resource Development: Aboriginal Engagement and Negotiated Agreements. Environment, Development and Sustainability 12 (2): 233–244.

    Article  Google Scholar 

  • Florida, R. 2002. The Economic Geography of Talent. Annals of the Association of American Geographers 94 (2): 743–755.

    Article  Google Scholar 

  • Glomsrød, S., I. Mäenpää, L. Lindholt, L., Mc Donald, H., Wei, T., & Goldsmith, S. (2017). Arctic economies within the Arctic nations. In: The Economy of the North 2015, ed. S. Glomsrød, G. Duhaime, and J. Aslaksen, Statistics Norway, Oslo.

    Google Scholar 

  • Gradus, Y., and H. Lithwick. 1996. Frontiers in Regional Development. Lanham, MD: Rowman & Littlefield.

    Google Scholar 

  • Grimsrud, K. 2017. Tourism in the Arctic: Economic Impacts. In The Economy of the North 2015, ed. S. Glomsrød, G. Duhaime, and J. Aslaksen. Oslo: Statistics Norway.

    Google Scholar 

  • Halseth, G., and L. Sullivan. 2004. From Kitimat to Tumbler Ridge: A Crucial Lesson Not Learned in Resource-Town Planning. Western Geography 13/14: 132–160.

    Google Scholar 

  • Hamilton, C.L., B.C. Brown, and R.O. Rasmussen. 2003. West Greenland’s Cod-to-Shrimp Transition: Local Dimensions of Climatic Change. Arctic 56 (3): 271–282.

    Article  Google Scholar 

  • Heininen, L., and C. Southcott, eds. 2010. Globalization and the Circumpolar North. Fairbanks: University of Alaska Press.

    Google Scholar 

  • Hill Strategies Inc. 2010. Artists in Small and Rural Communities in Canada. Statistical Insights on the Arts 8(2). http://www.arts.on.ca/AssetFactory.aspx?did=5773.

  • Holen, D., D. Gerkey, E. Høydahl, D. Natcher, M. Reinhardt Nielsen, B. Poppel, P.I. Severeide, H.T. Snyder, M. Stapleton, E.I. Turi, and J. Aslakse. 2015. Interdependency of Subsistence and Market Economies in the Arctic. In The Economy of the North 2015, ed. S. Glomsrød, G. Duhaime, and J. Aslaksen. Oslo: Statistics Norway.

    Google Scholar 

  • Huskey, L. (2006). Limits to growth: remote regions, remote institutions. The Annals of Regional Science, 40(1), 147-155.

    Google Scholar 

  • ———. 2017. An Arctic Development Strategy? The North Slope Inupiat and the Resource Curse. Canadian Journal of Development Studies 39 (1): 89–100.

    Article  Google Scholar 

  • Huskey, L., and C. Southcot. 2016. That’s Where My Money Goes: Resource Production and Financial Flows in the Yukon Economy. The Polar Journal 6 (1): 11–29.

    Article  Google Scholar 

  • Huskey, L., I. Maenpaa, and A. Pelyasov. 2014. Economic Systems. In Arctic Human Development Report, ed. J. Nymand Larsen and G. Fondahl. Copenhagen: Nordic Council of Ministers.

    Google Scholar 

  • Kruse, J. 2010. Sustainability from a Local Point of View: Alaska’s North Slope and Oil Development. In Political Economy of Northern Regional Development, ed. Gorm Winther, 55–72.

    Google Scholar 

  • Larsen, J.N. 2004a. External Dependency in Greenland: Implications for Growth and Instability. In Northern Veche, Proceedings of the Second Northern Research Forum, Veliky Novgorod, Russia, September, 19–22, 2002, ed. Jón Haukur Ingimundarson and Andrei Golovnov. Akureyri: Stefansson Arctic Institute.

    Google Scholar 

  • ———. 2004b. Trade Dependency and Export-Led Growth in an Arctic Economy: Greenland, 1955–1998. In Native Voices in Research, 2004, ed. Jill Oakes. Aboriginal Issues Press, University of Manitoba.

    Google Scholar 

  • ———. (2010). Economies and Business in the Arctic Region. In Loukacheva, N. (ed) Polar Law Textbook. TemaNord. Nordic Council of Ministers, Copenhagen.

    Google Scholar 

  • Larsen, J.N., and L. Huskey. 2010. Material Well-Being in the Arctic. In Arctic Social Indicators, ed. Joan Nymand Larsen, Peter Schweitzer, and Gail Fondahl. Copenhagen: Nordic Council of Ministers.

    Google Scholar 

  • ———. 2015. The Arctic Economy in a Global Context. In The New Arctic, ed. Birgitta Evengard, Joan Nymand Larsen, and Øyvind Paasche. London: Springer.

    Google Scholar 

  • Larsen, J.N., O.A. Anisimov, A. Constable, A.B. Hollowed, N. Maynard, P. Prestrud, T.D. Prowse, and J.M.R. Stone. 2014. Polar Regions. In Climate Change 2014: Impacts, Adaptation, and Vulnerability. Part B: Regional Aspects. Contribution of Working Group II to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change, 1567–1612. Cambridge, New York: Cambridge University Press.

    Google Scholar 

  • Leadbeater, D. 2009. Single-Industry Resource Communities, ‘Shrinking,’ and the New Crisis of Hinterland Economic Development. In The Future of Shrinking Cities: Problems, Patterns and Strategies of Urban Transformation in a Global Context, ed. Karina Pallagst et al. Berkeley: Institute of Urban and Regional Planning, University of California Berkeley.

    Google Scholar 

  • Loeffler, B. 2015. Mining and Sustainable Communities: A Case Study of the Red Dog Mine. Economic Development Journal 14 (2): 23–31.

    Google Scholar 

  • MacPherson, I. 2013. Cooperatives’ Concern for the Community: From Members Towards Local Communities’ Interests, January 3. Euricse Working Paper No. 46/13.

    Google Scholar 

  • McMillian, D., L. Wolf, and A. Cutting 2015. Alaska’s Nonprofit Sector. Economic Development Journal 14 (2).

    Google Scholar 

  • Megatrends. 2011. ed. R.O. Rasmussen. Nordic Council of Ministers, Copenhagen.

    Google Scholar 

  • Müller, D.K., and P. Brouder. 2014. Dynamic Development or Destined to Decline? The Case of Arctic Tourism Businesses and Local Labour Markets in Jokkmokk, Sweden. In Tourism Destination Development: Turns and Tactics, ed. A. Viken and B. Granås, 227–244.

    Google Scholar 

  • Myers, H. 1996. Neither Boom Nor Bust: The Renewable Resource Economy May Be the Best Long-Term Hope for Northern Economies. Alternatives Journal. 22 (4): 18–23.

    Google Scholar 

  • ———. 2000. Options for Appropriate Development in Nunavut Communities. Etudes/Inuit/Studies 24 (1): 25–40.

    Google Scholar 

  • Myers, H., and S. Forrest. 2000. Making Change: Economic Development in Pond Inlet, 1987–1997. Arctic 53 (2): 134–145.

    Article  Google Scholar 

  • Nielsen, S.B. 2013. Exploitation of Natural Resources and the Public Sector in Greenland. Background Paper for the Committee for Greenlandic Mineral Resources to the Benefit of Society, Copenhagen.

    Google Scholar 

  • Nordicity Group. 2014. Needs Assessment: Arts Administration Skills and Resources in Nunavut’s Arts and Culture Sector. Report for the Canadian Center for the Arts. Nordicity Group. http://canadacouncil.ca/council/research/find-research/2014/needs-assessment.

  • Nuttall, M. 2013. Zero-Tolerance, Uranium and Greenland’s Mining Future. The Polar Journal 3 (2): 368–383.

    Article  Google Scholar 

  • Parlee, B.L. 2015. Avoiding the Resource Curse: Indigenous Communities and Canada’s Oil Sands. World Development 74: 425–436.

    Article  Google Scholar 

  • Pelyasov, A.N. 2009. And the Last Become the First: Russian Periphery on the Way to Knowledge Economy (И последние станут первыми: Северная периферия на пути к экономике знания). URSS. [In Russian].

    Google Scholar 

  • Petrov, A. 2007. A Look Beyond Metropolis: Exploring Creative Class in the Canadian Periphery. Canadian Journal of Regional Science 30 (3): 359–386.

    Google Scholar 

  • ———. 2010. Post-Staple Bust: Modeling Economic Effects of Mine Closures and Post-Mine Demographic Shifts in an Arctic Economy (Yukon). Polar Geography 33 (1–2): 39–61.

    Article  Google Scholar 

  • Petrov, A.N. 2012. Redrawing the Margin: Re-Examining Regional Multichotomies and Conditions of Marginality in Canada, Russia and Their Northern Frontiers. Regional Studies 46 (1): 59–81.

    Article  Google Scholar 

  • Petrov, A. 2014. Creative Arctic: Towards Measuring Arctic’s Creative Capital. In Arctic Yearbook, ed. L. Heininen, 149–166. Akureyri: Northern Research Forum.

    Google Scholar 

  • ———. 2016. Exploring the Arctic’s Other Economies; Knowledge, Creativity and the New Frontier. The Polar Journal 6 (1): 30–50.

    Article  Google Scholar 

  • Petrov, A.N., S. BurnSilver, F.S. Chapin III, G. Fondahl, J.K. Graybill, K. Keil, et al. 2017. Arctic Sustainability Research: Past, Present and Future. London: Routledge.

    Book  Google Scholar 

  • Poppel, B. 2006. Interdependency of Subsistence and Market Economies in the Arctic. In The Economy of the North, Chapter 5, ed. Solveig Glomsrød and Julie Aslaksen. Oslo: Statistics Norway.

    Google Scholar 

  • Prno, J. An analysis of factors leading to the establishment of a social licence to operate in the mining industry. Resour. Policy 2013, 38, 577–590.

    Google Scholar 

  • Prowse, T., C. Furgal, R. Chouinard, H. Melling, D. Milburn, and S.L. Smith. 2009. Implications of Climate Change for Economic Development in Northern Canada: Energy, Resource, and Transportation Sectors. Ambio 38 (5): 272–282.

    Article  Google Scholar 

  • Rasmussen, R.O., G.K. Hovelsrud, and S. Gearheard. 2014. Community Viability and Adaptation. In Arctic Human Development Report: Regional Processes and Global Linkages (AHDR-II), Chapter 11, ed. Joan Nymand Larsen and Gail Fondahl. Copenhagen: Nordic Council of Ministers.

    Google Scholar 

  • Rodon, T., and F. Levesque. 2018. From Narrative to Evidence: Socio-Economic Impacts of Mining in Northern Canada. In Resources and Sustainable Development in the Arctic, 98–116. London: Routledge.

    Google Scholar 

  • Saxinger, G., A. Petrov, N. Krasnoshtanova, V. Kuklina, and D.A. Carson. 2016. Boom Back or Blow Back? Growth Strategies in Mono-Industrial Resource Towns–‘East’ and ‘West’. Settlements at the Edge: Remote Human Settlements in Developed Nations.

    Book  Google Scholar 

  • Selada, C., I. Cunha, and E. Tomaz. 2011. Creative-Based Strategies in Small Cities: A Case-Study Approach. REDIGE 2 (2): 79–111.

    Google Scholar 

  • Southcott, S. 2010. The Social Economy and Economic Development in the Canadian North: Constraints and Opportunities. In Political Economy of Northern Regional Development, ed. Gorm Winther, 55–72.

    Google Scholar 

  • Southcott, C., and V. Walker. 2009. A Portrait of the Social Economy in Northern Canada. The Northern Review 30: 13–36.

    Google Scholar 

  • Southcott, C., V. Walker, J. Wilman, C. Spavor, and K. MacKenzie. 2010. The Social Economy and Nunavut: Measuring Community Adaptive and Transformative Capacity in the Arctic.

    Google Scholar 

  • Storey, K. 2010. Fly-in/Fly-out: Implications for Community Sustainability. Sustainability 2 (5): 1161–1181.

    Article  Google Scholar 

  • Storey, K., and H. Hall. 2017. Dependence at a Distance: Labour Mobility and the Evolution of the Single Industry Town. The Canadian Geographer 62 (2): 225–237.

    Article  Google Scholar 

  • Tysiachniouk, M., 2016. Benefit sharing arrangements in the Arctic: Promoting sustainability of indigenous communities in Areas of Resource Extraction. Arctic and International Relations Series, Fall 2016 (4): 18-21, https://jsis.washington.edu/arctic/research/arctic-and-international-relations-series/

  • Tysiachniouk, M.S., and A.N. Petrov. 2018. Benefit Sharing in the Arctic Energy Sector: Perspectives on Corporate Policies and Practices in Northern Russia and Alaska. Energy Research & Social Science 39: 29–34.

    Article  Google Scholar 

  • Tysiachniouk, M.; Petrov, A.; Kuklina, V.; Krasnoshtanova, N. Between Soviet Legacy and Corporate Social Responsibility: Emerging Benefit Sharing Frameworks in the Irkutsk Oil Region, Russia. Sustainability 2018, 10, 3334.

    Google Scholar 

  • Wall, E. & Pelon, R. 2011. Sharing mining benefits in developing countries. Extractive industries for Development Series, 21, the World Bank, http://documents.worldbank.org/curated/en/359961468337254127/pdf/624980NWP0P1160ns00trusts0and0funds.pdf, (accessed 06.04.2017)

  • Wilson, E., 2016. What is the social license to operate? Local perceptions of oil and gas projects in Russia’s Komi Republic and Sakhalin Island. The Extractive Industries and Society #3, 73-81

    Google Scholar 

  • World Bank (2010) Mining Foundations, Trusts and Funds. A Sourcebook. The World Bank.

    Google Scholar 

  • Zbeed, S., & Petrov, A. (2017). Inventing the New North: Patents & Knowledge Economy in Alaska. Arctic Yearbook 2017.

    Google Scholar 

Download references

Acknowledgments

The authors are grateful to Mr. Petr Grin for his valuable assistance with preparing this manuscript. This work was partially supported by NSF #1532655.

Author information

Authors and Affiliations

  1. University of Akureyri and Stefansson Arctic Institute, Akureyri, Iceland

    Joan Nymand Larsen

  2. University of Northern Iowa, Cedar Falls, IA, USA

    Andrey N. Petrov

Authors
  1. Joan Nymand Larsen
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Andrey N. Petrov
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Andrey N. Petrov .

Editor information

Editors and Affiliations

  1. Johnson-Shoyama Graduate School of Public Policy, University of Saskatchewan, Saskatoon, SK, Canada

    Ken S. Coates

  2. Department of Political Studies, University of Saskatchewan, Saskatoon, SK, Canada

    Carin Holroyd

Rights and permissions

Reprints and permissions

Copyright information

© 2020 The Author(s)

About this chapter

Check for updates. Verify currency and authenticity via CrossMark

Cite this chapter

Larsen, J.N., Petrov, A.N. (2020). The Economy of the Arctic. In: Coates, K.S., Holroyd, C. (eds) The Palgrave Handbook of Arctic Policy and Politics. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-20557-7_6

Download citation

Publish with us

Policies and ethics

Search

Navigation