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1 8. 6. 2004Rüdiger Budde

Analysis with Remi Policy Insight Analysis with Remi Policy Insight in Nordrhein Westfalen – in Nordrhein Westfalen –

Including Sensitivity ExperimentsIncluding Sensitivity Experiments

Rüdiger BuddeRüdiger BuddeRWI-EssenRWI-Essen

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Agenda

• Introductory remarks• Specifia of the "Nordrhein Westfalen" modell• Selecting an industrial strategy• Quantifying the potential effects• Conclusions

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3 8. 6. 2004Rüdiger Budde

Northrhine - Westphalia

Ruhr area

Federal Republic of Germany

Neighbouringcountries

Specifis of the "Nordrhein Westfalen" Model

Oberhausen

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4 8. 6. 2004Rüdiger Budde

List of Projects with the REMI model

“Effects of the Metrorapid Railway in Nordrhein-Westfalen”

3 Studies on the impact on new industrial sites on the local economy and its neighbourhood

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5 8. 6. 2004Rüdiger Budde

City of Oberhausen (current situation)

• 220 000 inhabitants• Lies in the heart of the Ruhr-area• In 1987 7% of the employees were occupied in the steel

industry• In 2002 90% of the jobs in the steel industry were

vanished• Due to industrial changes huge brown fields emerged• First successful settlements while restructuring the

service sector• High unemployment rate (11%)• Objective 2 area up to 2006

(This status might be prolonged.)

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6 8. 6. 2004Rüdiger Budde

The Regional Economic Strategy

To develop the new industrial site

• Maximize the potential employment that can be settled on the available brown field.

• Prevent harmful competition between old industries and new settlers.

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7 8. 6. 2004Rüdiger Budde

Alternative facilities of operating a commercial site

 

stores specialized in

retail trade

industrial park with a focus on

traditional services

industrial park with a focus on

services for enterprises

industrial park with a focus on

health-care including

manufacture

  jobsshare of the total jobs

share of the total jobs

share of the total jobs

share of the total

sum of all jobs 2010 4200 9000 9700retail stores 510 25% 210 5%research and development 900 10% 970 10%services for real estate property 900 10% 485 5%computing services 2700 30% 970 10%

logistic 600 30% 420 10%healthcare 2250 25% 2910 30%other services 900 45% 2520 60% 2250 25% 2425 25%manufacture 1050 25%medical technology 1940 20%

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8 8. 6. 2004Rüdiger Budde

• The results refer to the average of the first four years of production after achieving the aimed degree of efficiency

• Year of reference is 2008

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9 8. 6. 2004Rüdiger Budde

Sensitivity analysis

Scenario 1 The model is used with all standard implications. Furthermore it is implied that there will be no regional or industry reaction in competition due to undertaking the investment.Ruhr-areaRest of Northrhine-WestphaliaNorthrhine-Westphalia as a whole Ratio of Occupation

Scenario 2 The model is used with all standard implications. The investment finds itself in the position of regional or industry competition.Ruhr-areaRest of Northrhine-WestphaliaNorthrhine-Westphalia as a whole Ratio of Occupation

Scenario 3 Input-Output Analysis.the Ruhr-areaRest of Northrhine-WestphaliaNorthrhine-Westphalia as a whole Ratio of Occupation

jobsdirectindirectdirect

jobsdirectindirectdirect

jobsdirectindirectdirect

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10 8. 6. 2004Rüdiger Budde

Expected effects in the Ruhr-area (in absolute figures)

  Scenario 1 Scenario 2 Scenario 3

Stores specialized in retail trade 2.850 1.600 2.510

Industrial park with a focus on traditional services 5.900 3.580 5.610

Industrial park with a focus on services for enterprises 13.850 6.780 12.520

Industrial park with a focus on health-care including manufacture)

14.070 7.690 12.590

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11 8. 6. 2004Rüdiger Budde

Expected effects in the remaining part of NRW (in absolute figures)

  Scenario 1 Scenario 2 Scenario 3

Stores specialized in retail trade 370 -550 160

Industrial park with a focus on traditional services 800 -880 430

Industrial park with a focus on services for enterprises 1.780 -2.250 890

Industrial park with a focus on health-care including manufacture

1.800 -2.040 860

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12 8. 6. 2004Rüdiger Budde

Expected effects in whole State (in absolute figures)

  Scenario 1 Scenario 2 Scenario 3

Stores specialized in retail trade 3.220 1.050 2.670

Industrial park with a focus on traditional services 6.700 2.700 6.040

Industrial park with a focus on services for enterprises 15.630 4.530 13.410

Industrial park with a focus on health-care including manufacture

15.870 5.650 13.450

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13 8. 6. 2004Rüdiger Budde

Expected occupational effects in whole Northrhine-Westphalia (in relative figures)

  Scenario 1 Scenario 2 Scenario 3

Stores specialized in retail trade 1.60 0.52 1.33

Industrial park with a focus on traditional services 1.60 0.64 1.44

Industrial park with a focus on services for enterprises 1.74 0.50 1.49

Industrial park with a focus on health-care including manufacture)

1.64 0.58 1.39

jobsdirectindirectdirect

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14 8. 6. 2004Rüdiger Budde

On the basis of the research results

The elaborated concept • The Industrial park with a focus on health-

care including manufacture • In order to attract potential customers as

well as potential investors a theme park on healthcare is implemented within the industrial park

Future Park O.Vision

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15 8. 6. 2004Rüdiger Budde

Future Park O.Vision

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Evaluation of “O.Vision”

themepark (public funding where possible)

industrial park (private funding only)

phase of construction

buildings InfrastuctureExhibitions

buildings and the infrastucture

used methodI-O tables,

(due to international tendering procedures, there was no way to regionalize the figures)

phase of operating

operating Themepark

operating all settled enterprises

used method Remi –Standard Model

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17 8. 6. 2004Rüdiger Budde

  dimensiontheme-

park(1)

industrial park(2)

relation (2) /( 1)

direct potential of occupation

workingyears 1322 5636 4.3

indirect potential of occupation

workingYears 929 3975 4.3

contribution to the GDP Mill. € 110.9 437 3.9

Expected developement while building the themepark and the industrial park

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18 8. 6. 2004Rüdiger Budde

Occupational effects of the themepark (sensitive analysis)

Direct employees in the Themepark 175Scenario 1

No regional or industry reaction in competition due to undertaking the investment.

Direct and indirect jobs

Ruhr-area 290Rest of Northrhine-Westphalia 39Northrhine-Westphalia as the whole 329

Ratio of Occupation: 1,8Scenario 2 Strong regional or industry competition.

Ruhr-area 205Rest of Northrhine-Westphalia -34Northrhine-Westphalia as the whole 171

Ratio of Occupation: 0,98Scenario 3 Input-Output Analysis.

the Ruhr-area 219Rest of Northrhine-Westphalia 18Northrhine-Westphalia as the whole 237

Ratio of Occupation: 1,35

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19 8. 6. 2004Rüdiger Budde

Occupational effects of the industrial park (sensitive analysis)

Direct employees in the inustrial park 7.089

Scenario 1 No regional or industry reaction in competition due to undertaking the investment.

Direct and indirect jobs

Ruhr-area 10.318Rest of Northrhine-Westphalia 1.985Northrhine-Westphalia as the whole 12.303

Ratio of Occupation: 1,74Scenario 2 Strong regional or industry competition.

Ruhr-area 5.590Rest of Northrhine-Westphalia -1.216Northrhine-Westphalia as the whole 4.432

Ratio of Occupation: 0,62Scenario 3 Input-Output Analysis.

the Ruhr-area 9.650Rest of Northrhine-Westphalia 1.012Northrhine-Westphalia as the whole 10.662

Ratio of Occupation: 1.50

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20 8. 6. 2004Rüdiger Budde

Conclusions

• Distinct positive impact on employment in the Ruhr area

• Success of the strategy as a whole, highly depends on situation investment finds itself in market conditions– Inter-regional competition– Inter-industrial competition