Escaping the boom-bust cycle: Identifying sustainable governance strategies for shale-dependent communities

University Of California-Davis, Davis CA

Investigators

Abstract

The project studies how communities affected by boom-bust cycles in natural resource extraction - specifically shale oil and gas drilling - try to reduce the cycle's local negative consequences and extend its positive impacts. In a boom-bust cycle, communities rich in natural resources experience rapid economic growth when demand spikes, then rapid economic decline when resources are exhausted or demand dissipates. Both trends are often accompanied by increases in crime, infrastructure damage, and environmental degradation, and reduced quality of life. There is little research on how communities use the tools of county and city-level governance - such as public investment, subsidies, taxes, and zoning - to manage societal problems linked to boom-bust cycles and perpetuate positive impacts, such as increases in local employment, after a boom ends. The project identifies governance strategies used by localities in three U.S. states (Ohio, Pennsylvania, West Virginia) affected by the recent shale drilling boom and bust. It examines how community characteristics and local and regional networks of information and resource-sharing among policymaking participants may influence the strategies communities adopt. Finally, it studies how citizens and stakeholders perceive these strategies and which factors encourage communities to deploy more successful governance approaches. This project is a mixed-methods investigation of the strategies that local governments pursue to mitigate adverse impacts and leverage positive aspects of the shale drilling boom-bust cycle. By conducting interviews and analyzing survey data with social network and statistical techniques, the research team examines how Ohio, Pennsylvania, and West Virginia communities overlaying the Marcellus and Utica Shales have tried to manage the boom-bust cycle. Specifically, the researchers investigate: how pressures from citizens, stakeholders, and government actors affect whether cities and counties adopt boom-bust governance strategies, which strategies they choose, and how strategies diffuse among jurisdictions; whether systematic differences exist between jurisdictions that fail to consider a given approach, fail to adopt it, or adopt it successfully; and how the composition of and strength of ties within local governance networks influence the strategies jurisdictions adopt and how successful citizens, stakeholders, and decision makers view the strategies. The project brings a cross-sectional, quantitative approach to issues typically studied with qualitative, small-n techniques, building theoretical micro-foundations for and testing key assumptions in the policy diffusion and adoption, sustainability, and boom-bust literatures. The research aims to produce actionable insights for communities currently experiencing pernicious boom-bust effects.