The Local Economic Impact of Shale Gas Extraction

Abstract

Advocates of UK shale gas expansion have focused upon predicted national economic benefits, but local and/or regional impact has been largely neglected. This paper seeks to address this deficit by creating a unique dataset, combining industry data with consumer and supply chain surveys, thereby overcoming the current absence of suitable secondary data. Local economic impact in the Bowland field is estimated via a simple Keynesian local income multiplier model. Results emphasize the importance of facilitating local employment opportunities, through skills initiatives, and development of regional supply chain clusters, to anchor economic benefits within the local economy. Policy implications are discussed.