Socioeconomic Benefits from Investments in the Leisure Industry

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Socioeconomic benefi ts of investment in the

leisure industry

In what way does a region of popula on decline benefi t from

investment in the leisure industry: Case of the Eemsdelta

Dirk van de Ven

Master thesis Human Geography, Urban and Cultural Geography School of Management

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Socioeconomic benefi ts of investment in the

leisure industry

In what way does a region of popula on decline benefi t from

investment in the leisure industry: Case of the Eemsdelta

Master thesis Human Geography, Urban and Cultural Geography School of Management

Radboud University Nijmegen

Supervisor Radboud University Nijmegen: prof. dr. Huib Ernste

Supervisor Hanze University of Applied Sciences Groningen: dr. Elles Bulder

Dirk van de Ven

S4635604

June 2018

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Preface

This Master’s thesis is about the socioeconomic benefi ts of investment in the leisure industry in the Eemsdelta. This research is the fi nal task of my studies in Human Geography before I graduate from the Radboud University in Nijmegen. The Bachelor’s thesis I wrote last year was about the consump on and preserva on of cultural heritage by local communi es in Indonesia. This increased my interest in tourism and its impact on local communi es and the environment. Bureau NoorderRuimte, a research ins tute from the Hanze University of Applied Sciences in Groningen, oﬀ ered an opportunity to link these subjects to the contemporary “tendency”: popula on decline. This is an interes ng topic as the Eemsdelta provides a new perspec ve on this discourse. Furthermore, looking at the opportuni es oﬀ ered by popula on decline to the leisure industry, and how the industry mi gates the associated problems, was also interes ng to me.

Working on this thesis took a considerable amount of me and eﬀ ort. I want to thank my supervisors: Huib Ernste (Radboud University) and Elles Bulder (Hanze University of Applied Science). Both supervisors gave useful feedback and supervised me throughout the process. I would also like to thank the interviewees, all of whom were very open, gave nice insights and showed their perspec ve very well. It was a nice experience and hopefully this thesis is also valuable to them.

Dirk van de Ven

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Summary

The Eemsdelta is a region in the northern Netherlands that consists of four municipali es: Delfzijl, Eemsmond, Appingedam and Loppersum. The region is one of nine in the Netherlands facing popula on decline, which is the reduc on of the popula on over me in a certain region. This is not a new phenomenon, but the structural aspect makes it new and cri cal. In the Eemsdelta, popula on decline is accompanied by dejuvena on and ageing. The demographic transi on is seen as a threat to the region as it is associated with high vacancy rates, deteriora on and reduced ac vity. Research on popula on decline generally focuses on a rac ng new residents and on the construc on of houses. Some studies show that regions of popula on decline oﬀ er opportuni es for entrepreneurs in the leisure industry and that the consequences of popula on decline can therefore be mi gated. In studies where tourism is addressed as a “solu on” for popula on decline the focus lies upon a rac ve and/or touris c regions. However, the Eemsdelta is not seen as an a rac ve region and its touris c industry is limited. Because the Eemsdelta diﬀ ers from the discussed a rac ve/touris c regions, it could be ques oned whether these opportuni es also apply to the Eemsdelta. Moreover, the ma er of whether the aforemen oned investment mi gates the consequences of popula on decline can also be ques oned. The goal of this research is therefore to determine if opportuni es for entrepreneurs exist in the leisure industry in the Eemsdelta and to examine how the region benefi ts from investment.

To demonstrate which opportuni es are available for entrepreneurs in the leisure industry and to see how the region benefi ts from investment, two no ons are used: “economies of scale” and “a rac veness.” Economies of scale refer to the advantages that accrue in an agglomera on, and the concept is used to examine the economic benefi ts. A large agglomera on oﬀ ers more opportuni es for entrepreneurs to make profi t, which makes larger agglomera ons more a rac ve. Furthermore, both consumers and suppliers profi t from proximity to each other. Regions of popula on decline encounter a vicious circle as the agglomera on becomes smaller, and as argued by Myrdal tendencies can reinforce themselves through a feedback loop. In this context, new investments have a posi ve impact as they contribute to the agglomera on. The general idea is that economic ac vity leads to new investments and in turn those investments might mi gate the consequences by breaking the vicious circle. The necessity of these new investments also arises from the idea of a global-local paradox, where locality appears to become more important during a me of globaliza on. Marshall men ons several external economies of scale that companies have in such clusters, which include: be er matches between employees and employers; local supplier linkages; and the transac on of knowledge occurs more quickly, which facilitates innova on.

The second no on, “a rac veness,” discusses social benefi ts for the region resul ng from investment in the leisure industry. Even though investments are o en made with an economic mindset, they posi vely impact various social aspects. In our consumer city as Marlet terms it, the importance of a rac ons and facili es has increased. Investments in the leisure industry also include facili es that residents can make use of, and o en lead to enhanced ac vity as awareness of this investment grows. However, as tourists have a higher economic value in this context the focus o en lies on them rather than on local recrea onal visitors. As tourists are viewed diﬀ erently to the residents of a region, its residents are not always able to socially benefi t from these investments.

This research begins with a literature review, to obtain a clear idea of the current situa on regarding regions of popula on decline. All depopula ng regions diﬀ er, which makes interviews with professionals and policy makers on these topics very valuable; here they provide an idea of the situa on in the Eemsdelta. To illustrate the concrete benefi ts of investment, nine cases are examined. Actors invest in facili es to serve visitors in rela on to the two central quali es of the Eemsdelta: its landscape and culture. Mul ple actors are involved in the leisure industry, and to show the various benefi ts for the region this research makes use of four selected actors: government (public interests), organiza ons (group-specifi c interests), large entrepreneurs (commercial interests) and small entrepreneurs (social interests). Interviews with the actors iden fy their interests and eﬀ ec vely demonstrate the economic aspect, while interviews with residents indicate how they perceive the investments. All interviews are coded and analyzed to determine these perspec ves and how the region might benefi t from the considered investment.

Several studies claim that depopula ng regions oﬀ er opportuni es for entrepreneurs in the leisure industry. It is considered whether this also applies for the Eemsdelta as it is viewed as an una rac ve region and has an underdeveloped tourism industry. This research indicates that the aforemen oned opportuni es apply to a lesser extent to the Eemsdelta, while the risks are evident. This results from the combina on of selec ve spa al processes, earthquake issues and limited touris c poten al in the region. Consequently, inves ng in this region is rela vely risky. Nevertheless, opportuni es do exist for entrepreneurs to make

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a profi t. Many investors focus on mul ple assets and thus combine diverse actors. This approach is risk reducing and makes it possible to focus on region-specifi c opportuni es, such as increasing employment in the Eemshaven.

The diff erences between non-profi t investors and profi t-oriented investors are very clear, as entrepreneurs focus on making profi t while non-profi t organiza ons want to develop the region and s mulate new investment. Overall, the economic benefi ts of investment in the local economy are very limited as investments are generally rather small and located outside the center. Moreover, this is also related to the fact that the leisure industry is a service-based industry and not a product-based industry. Even though the economic benefi ts for the region are limited, investment in the leisure industry is s ll highly valuable as it posi vely impacts various elements of a rac veness in diff erent ways, including employment, quality of living, environment, commo on, quality of nature and quality of culture. However, the no on of a rac veness appears insuffi cient as other social benefi ts arise. Investment has a posi ve impact on the image of the region, and in combina on with cultural values this raises awareness and respect towards others. Successful investment by the government could also lead to more confi dence in the government, and could for instance make people prouder of the region. Thus, opportuni es are available for entrepreneurs in the Eemsdelta leisure industry, but these are limited. Inves ng has a limited impact on the economic situa on, but the social aspects indicate that inves ng does pay off (albeit fi gura vely).

This research is focused on the Eemsdelta in general, which contains depopula ng villages in addi on to villages experiencing popula on growth. These growing or stable villages are more a rac ve, and investments in these villages might therefore be inapplicable to truly depopula ng regions. Furthermore, the fact that the “limited absorp on capacity” is evident increases the challenge of fi nding appropriate investments. However, this thesis off ers a new perspec ve on opportuni es for and benefi ts of investment in the leisure industry in depopula ng regions. It would be interes ng to observe the diff erences between the Eemsdelta and other depopula ng regions, as this could verify the conclusions of this research. On the other hand, it is also interes ng to view diff erences within the Eemsdelta. The Eemsdelta is examined as a single unit, although it consists of four diff erent municipali es with diff erent policies and many villages within these municipali es.

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List of tables and fi gures

Figures

Front page: Moluccan church under development. Source: own fi gure, 2017 Figure 1. Loca on of the Eemsdelta. Source: own fi gure, 2017

Figure 2. Popula on decline in the Eemsdelta. Source: own fi gure based on data from Planbureau voor de

Leefomgeving, 2016

Figure 3. Agglomera ons (normal). Source: Marlet and Van Woerkens, 2013

Figure 4. Agglomera ons (near a country border). Source: Marlet and Van Woerkens, 2013 Figure 5. ING tourism index. Sources: ING Economic Bureau, 2016

Figure 6. Development of the number of recrea onal touris c facili es. Source: Goossen, Kuhlman and

Breman, 2012

Figure 7. Development of the number of recrea onal touris c facili es per region of popula on decline. Source: Goossen, Kuhlman and Breman, 2012

Figure 8. Development of the number of recrea onal touris c jobs. Source: Goossen, Kuhlman and Breman, 2012

Figure 9. Development of the number of recrea onal touris c jobs per region of popula on decline. Source: Goossen, Kuhlman and Breman, 2012

Figure 10. Conceptual model. Source: own fi gure Figure 11. Migra on paterns. Source: PBL, 2015 Figure 12. Menkemaborg. Source: own fi gure

Figure 13. Basic image of Groningen. Source: own fi gure

Figure 14. Apprecia on of peat districts. Source: Rijnks and Strijker, 2011 Figure 15. Vacant building in Delfzijl. Source: own fi gure

Figure 16. Wadden Sea. Source: own fi gure Figure 17. Exis ng beach. Source: own fi gure Figure 18. Moluccan church. Source: own fi gure Figure 19. Boertel Lentemaheerd. Source: own fi gure Figure 20. Hotel Termunterzijl. Source: own fi gure Figure 21. De Vijgenhof. Source: own fi gure Figure 22. Camping de Breede. Source: own fi gure Figure 23. Vispaleis Westerhuis. Source: own fi gure

Figure 24. Swimming pool at Camping de Breede. Source: own fi gure Figure 25. Synagogue. Source: own fi gure

Figure 26. Fes val ‘Terug naar het Begin’. Source: Eemskrant, 2016. From h ps://www.eemskrant.nl/ groningse-rapforma e-wat-aans-laat-leermens-trillen-met-de-trilploat- jdens-keetpop/

Figures in appendices

Figure 1.1. Hanging kitchens. Source: own fi gure

Figure 1.2. Flood defense in Termunterzijl. Source: own fi gure Figure 1.3. Church Source: own fi gure

Figure 1.4. Mill. Source: own fi gure

Figure 2.1. Style segmenta on. Source: own fi gure based on NBTC Holland (2008) Figure 2.2. Recrea onal segmenta on. own fi gure based on RECRON, 2010

Figure 4.1. Open coding. Source: own fi gure Figure 4.2. Families. Source: own fi gure

Figure 4.3. Families: number of tourists. Source: own fi gure Figure 4.4. Families: popula on decline. Source: own fi gure Figure 4.5. Families: economic benefi ts. Source: own fi gure Figure 4.6. Families: social benefi ts. Source: own fi gure Figure 4.7. Families: opportuni es. Source: own fi gure Figure 4.8. Families: investment. Source: own fi gure

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Tables

Table 1. Depopula on in regions of popula on decline since peak year: Source (Derks, 2016) Table 2. Number of domes c vaca ons in 2002 and 2015. Data based on CVO, NBTC-NIPO Research Table 3. Supply of sleeping accommoda ons in 2016. Data based on CBS, 2016

Table 4. Number of guests and overnight stays per province and origin in 2015. Data based on CBS, 2016 Table 5. The city of Groningen compared to the rest of the province and the Netherlands concerning visi ng

tourists in 2010. Data based on Con nuVakan eOnderzoek 2010-2011, 2011

Table 6. Economic ac vity, indicated by the number of jobs in 2010 and 2015. Data based on CBS, 2016 Table 7. Research cases wih n the Eemsdelta. Source: own table

Table 8. Organiza onal interviewees. Source: own table Table 9. Governmental interviewees. Source: own table Table 10. Professional Interviewees. Source: own table

Table 11. Percentage of employed popula on. Source: CBS, 2014

Table 12. Research cases: diﬀ erent investments in the Eemsdelta. Source: own table Table 13. Economic benefi ts from investments by the government. Source: own table Table 14. Economic benefi ts from investments by an organiza on. Source: own table Table 15. Economic benefi ts from investments by large entrepreneurs. Source: own table Table 16. Economic benefi ts from investments by small entrepreneurs. Source: own table Table 17. Social benefi ts from investments by the government. Source: own table

Table 18. Social benefi ts from investments by an organiza on. Source: own table Table 19. Social benefi ts from investments by an organiza on. Source: own table Table 20. Social benefi ts from investments by small entrepreneurs. Source: own table

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Chapter 1. Introduc on

The Eemsdelta is one of nine regions in the Netherlands facing popula on decline (Rijksoverheid, 2017). The Eemsdelta is a region in the north of the country that consists of four municipali es: Delfzijl, Eemsmond, Appingedam and Loppersum. Individually, these municipali es are experiencing certain consequences of popula on decline, which is accompanied by dejuvena on, for instance brain drain and ageing, which is having major impacts on the region. Popula on decline has a nega ve connota on as it is o en associated with the disappearance of facili es and employment (Remijn, 2015). In contrast, RECRON (2011) argues that popula on decline creates opportuni es for entrepreneurs in the leisure industry. This proposi on is replicated by other researchers, thus crea ng the idea that tourism and recrea on could mi gate the consequences of depopula on. This research examines what investments in the leisure industry could imply for the Eemsdelta.

Depopula on or popula on decline is the reduc on of the popula on over me in a certain region. Although depopula on has o en occurred in history, historically the decline was not structural as it currently is in most developed countries. The UN even expects the global popula on to begin declining in 2075 (Derks, Hovens, & Klinkers, 2006). Popula on decline diff ers between regions, which makes it diffi cult to discuss in general. The idea that demographic transi on off ers opportuni es for entrepreneurs in the leisure industry is not proven to apply to the Eemsdelta. S ll the na onal and provincial government of Groningen are inves ng a considerable amount of (public) money in regions of popula on decline. This money is partly directed to the leisure industry. The province of Groningen speaks of its great touris c poten al and of inves ng during the coming years in entrepreneurship, rou ng and marke ng (Provincie Groningen, 2016). By doing so, they want to posi vely infl uence the local economy. However, earthquake issues are currently reinforcing the tendencies of popula on decline and making investment in the Eemsdelta riskier. Today, earthquakes in northern Groningen resul ng from natural gas extrac on are a hot topic. The media is giving a lot of a en on to this region, but the eff ects for the leisure industry are doub ul.

This thesis aims to further knowledge about the benefi ts of investment in the leisure industry in the Eemsdelta. People view the leisure industry as an opportunity to mi gate current and future circumstances. However, because the Eemsdelta is not seen as an a rac ve touris c region (Sweco, 2016) the economic benefi ts of investment could be disappoin ng. Nevertheless, as it could have social benefi ts for local communi es, this investment could s ll be valuable. Hence the goal is to iden fy the benefi ts of investment in the leisure industry, which leads to the following research ques on:

“What are the socioeconomic benefi ts of investment in the leisure industry in the Eemsdelta?”

The thesis also a empts to answer the following sub-ques ons:

1. What are the eﬀ ects of popula on decline for entrepreneurs in the leisure industry in the Eemsdelta? 2. How do investors in the Eemsdelta make use of the demographic transi on and other tendencies? 3. What are the economic benefi ts resul ng from investment in the leisure industry in the Eemsdelta? 4. What are the social benefi ts resul ng from investment in the leisure industry in the Eemsdelta?

The focus of the study lies on investment in the Eemsdelta (Figure 1) that relates to tourism and recrea on. This qualita ve research applies the percep ons of professionals, entrepreneurs, (governmental) organiza ons and residents, and both economic and social benefi ts are subsequently examined from this perspec ve. A literature review and interviews are central in obtaining informa on. A large amount of knowledge is available about popula on decline and the leisure industry, and interviews with experts place this broad array of informa on in a local perspec ve. The no ons of economies of scale (economic benefi ts) and a rac veness (social benefi ts) are used to analyze the benefi ts, which are clearly presented as interviews are coded and organized into families based on the sub-ques ons.

Societal relevance

Popula on decline is a growing phenomenon, as the global popula on will decrease for the fi rst me in history – with the excep on of wars and epidemics – in 2075. Europe and other western countries like Japan are already facing depopula on as result of a decreasing or delayed fer lity (Derks, Hovens, & Klinkers, 2006). Some regions, especially peripheral regions, have already experienced popula on decline for a longer period of me (Haartsen & Venhorst, 2010). In some regions within the Netherlands, demographic changes can be no ced very clearly as delayed or declining fer lity, in combina on with the rise of life expectancy,

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results in an ageing popula on. Addi onally, young people are leaving peripheral regions to study or work in the city (Bulder, 2017). These trends are interconnected and are therefore diﬃ cult to observe separately. This transi on is generally seen as a threat for the region (Dalen, 2008), because it is associated with a high vacancy rate, deteriora on, an elderly popula on and places with li le ac vity (Dam, Verwest, & Groot, 2008; Dalen, 2008). Demographic transi on therefore has major impacts on a resident’s life.

In many studies, a focus on the leisure industry is considered a strategy to mi gate the consequences of popula on decline. Faulkner and Tideswell (1997) argue that local communi es experience consequences, both posi ve and nega ve, from a growth in tourism. Hence municipali es aim to a ract tourists in order to create and improve economic prospects for local entrepreneurs. In this way, recrea onal func ons and the quality of living in the region are simultaneously improved, both of which local residents benefi t from.

Between 2014 and 2018 the Economic Board Groningen (EBG) will have invested 97.5 million euro in northern Groningen (i.e., in the nine municipali es dealing with earthquakes) to give the economy a “new impulse” (Economic Board Groningen, 2017). The general opinion is currently that the leisure industry can mi gate the consequences of popula on decline and that new possibili es will arise in those regions. The provincial government of Groningen speaks of its great touris c poten al, while the House of Representa ves sees economic poten al for the leisure industry in regions of depopula on and Kees Verhoeven (D66, Social Liberal Party) wanted to encourage the industry through inves ng in culture and nature (RECRON, 2011). Currently, approximately 75% of municipali es in the Netherlands have city and regional marke ng plans and largely focus on a rac ng tourists (Hospers, Verheul, & Boekema, 2011). They market themselves as products or goods which they try to sell to companies, residents and tourists. Many previous interna onal campaigns have been highly successful and resulted in economic development (Ashworth & Voogd, 1990), which explains the interest in this sector. Municipali es in the Eemsdelta are also focusing on tourists in order to profi t from the growing tourism industry. The municipali es of Appingedam and Delfzijl produced a report about the development of their region up to 2030, with tourism and recrea on as one of the

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focal points. These municipali es view the region as an area with many possibili es and opportuni es for the leisure industry, for example by extending the current oﬀ erings (Vliet & Dijkstra, 2009). However, it can be ques oned whether the government should focus on tourists, because the tourism industry is very limited in Groningen (NBTC, 2012; CBS, 2010). This can be traced back to the number of tourists going to the region; data from both CBS (2010), the Central Agency for Sta s cs in the Netherlands, and NBTC (2012), the agency responsible for marke ng the Netherlands, reveal that the share of tourists visi ng the province of Groningen is the lowest in the Netherlands, followed by Flevoland and Utrecht. Another remarkable result is that most tourists in Groningen are from the province of Groningen itself. The touris c poten al of northern Groningen is even more uncertain (Remijn, 2015). The greatest a rac ons for tourism in northern Groningen (Bourtange, Blauwestad, Nieuweschans health resort and Lauwersmeer) are not located in the Eemsdelta, so the touris c poten al of the Eemsdelta could be assessed as low. Although the overall economic impact of investment in the region could be disappoin ng, it could s ll be valuable.

Most studies consider the economic aspect of investment, but in the case of a region experiencing popula on decline the social aspect is equally important. The case of the Eemsdelta is therefore very useful, because the tourism industry is rela vely small and has li le poten al, so results from other regions cannot be generalized. Un l now no clear connec ons have been made between popula on decline and benefi ts from investment in the leisure industry. Furthermore, confl ic ng informa on exists concerning the opportuni es and benefi ts resul ng from this investment, due to the complex nature of popula on decline and the unique situa on of the Eemsdelta. Consequently, this research could help current policy makers in the Eemsdelta in their decision to invest in the leisure industry and how to do so.

ScienƟ fi c relevance

Un l recently, research in the fi eld of popula on decline was dominated by the a rac on of new residents to stabilize popula on size. Although the discourse surrounding demographic transi on remains dominated by research about the physical environment and how to deal with depopula on, some literature addresses other fi elds of research; for instance, the infl uence of culture and sociological aspects (Verwest, Sorel, & Buitelaar, 2008; Dam, Verwest, & Groot, 2008; Haartsen & Venhorst, 2010; Gardenier, 2012). This research contributes a new outlook to the dialog on popula on decline.

Some scholars have proposed a rela on between popula on decline and the leisure industry. Several of these researchers have examined whether the leisure industry can mi gate the consequences of popula on decline in a region (Remijn, 2015) and the possibili es for investors in the leisure industry in these regions (Kuhlman, et al., 2012). These researchers generally examine economic benefi ts and give less a en on to the social aspects. By examining both economic and social benefi ts, this research contributes to the literature by adding a new perspec ve.

Exis ng studies focus on a rac ve and more developed touris c regions; Bijker and Haartsen (2012) already suggested that northern Groningen is less a rac ve. Moreover, every depopula ng region is diﬀ erent and the results cannot be generalized. Un l now no research has considered tourism in the Eemsdelta or the benefi ts and implica ons of investment in this sector for the region. In doing so, this research also fi lls a gap in the literature.

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Chapter 2. Theory

The leisure industry can be used to mi gate the consequences of popula on decline. This chapter discusses theories and concepts applied to iden fy the benefi ts of investment in the leisure industry. Addi onally, popula on decline and the leisure industry are discussed and linked to the relevant theories. The conceptual model that follows shows how these theories are related and how the research is put into use.

2.1 Economies of scale

Investment in the leisure industry impacts the economic situa on. The concept of economies of scale is used to determine the mo ves of entrepreneurs to invest in a region and how a region benefi ts from investment. Economies of scale are advantages that accrue in an agglomera on. Consumers and suppliers both profi t from proximity to one another (Investopedia, 2017). Therefore, it is a rac ve to invest and to live in a city, because an urban agglomera on oﬀ ers more opportuni es to gain profi t. This has consequences for peripheral regions.

2.1.1 Economies of scale to investors

In the concept of cumula ve causa on, Myrdal (1957) acknowledges that suppliers achieve economies of scale when they concentrate in a bounded area. He uses the no ons of vicious and virtuous circles to explain that an event or ac on can reinforce itself through a certain feedback loop. The impact of such an event can be posi ve (virtuous) or nega ve (vicious). A large agglomera on carries out more economic ac vi es and therefore has a compe ve edge compared to neighboring regions, which creates a certain imbalance (Fujita, 2007). The region with an advantage thus becomes a more interes ng place to invest due to economies of scale. Centers therefore con nue to grow at the expense of periphery.

In his book “The Rise of the Crea ve Class” Richard Florida writes about the crea ve class as the motor for economic development. He argues that a higher number of residents results in higher employment rates (Florida, 2003). This is based on the idea that companies prefer to be located in a large agglomera on. This idea has been cri cized by the Netherlands Environmental Assessment Agency [Planbureau voor de Leefomgeving], which suggests that this assump on is Randstad-oriented. The Dutch research agency argues that a higher number of residents does not necessarily lead to more employment when the situa on is located outside the Randstad. Instead, people outside the Randstad choose a favorable residen al area, because housing op ons are less scarce (De Graaﬀ , Van Oort, & Boschman, 2008).

There are several economies of scale that make being located in a large agglomera on interes ng for suppliers. Globaliza on has increased compe on among suppliers and a large agglomera on results in a be er compe ve posi on in the global economy (Van Oort, 2013). This global compe on has par cularly increased the importance of specifi c regions or hubs. Michael Porter speaks of a global-local paradox, while Edward Glaeser argues in “Triumph of the City” that the city has gained importance not in spite of but thanks to globaliza on (Raspe, 2012). These clusters are profi table for produc vity; as stated by Glaeser (2014): “Produc vity per capita goes up about 15 percent when the popula on size of a metropolitan area

doubles — that’s just a sta s cal rela onship” (p. 9).

Alfred Marshall is a well-known Bri sh economist from the early 20th century. In his book “Principles of Economics” he refers to internal and external economies of scale. Internal economies of scale are the advantages occurring within a company when it expands, while external economies of scale are advantages for the whole industry. External economies of scale are useful in this thesis (Marshall, 1895).

Labor market pooling is an external economy of scale, and refers to “advantages for workers and

fi rms deriving from sharing a labor market that is territorially limited to a small area: the local labor market”

(Andini, De Blasio, Duranton, & Strange, 2013, p. 1008). Localiza on of companies is of interest for both employers and employees. In a popula on with skilled employees, fi rms are able to fi ll their job vacancies more quickly, while employees have more op ons to be employed. In terms of skills, experiences and aspira ons increased supply and demand also results in be er matches between employers and employees. Besides, the experiences and skills obtained by an employee in one company can be of use in another company, a concept known as learning spillover. Moreover, compe on among companies to fi ll vacancies could also lead to higher wages for employees (Andini, De Blasio, Duranton, & Strange, 2013; Raspe, 2012). A second external economy of scale is input sharing, which refers to a large choice of input suppliers. Proximity of related industries oﬀ ering the required input is cost reducing, and leads to innova on in products and services. Likewise, suppliers can benefi t from a large market of upstream companies purchasing the

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oﬀ ered products and services. This also reduces transport costs in a broad sense, including the exchange of goods, people and ideas. Even though the costs of transport have already decreased enormously, the importance of locality remains (Henderson & Thisse, 2004; Raspe, 2012).

The third external economy of scale is knowledge spillover. Marshall (1895) uses this idea to show that companies benefi t from both intended and unintended knowledge transfer. Even though the exchange of informa on is generally unintended, it facilitates innova on (Helsley & Strange, 2002). Clustering leads to quicker transac on of knowledge which makes ci es innova ve hotspots (Raspe, 2012). Marshall argues that “most important spillovers occur within industries, and therefore encourage the forma on of specialized

industrial clusters” (Helsley & Strange, 2002, p. 25-26). However, Marshall’s point of view about where the

most important spillovers take place contrasts with Jane Jacobs’ view. Jacobs (1969) stresses that “most

important spillovers occur between rather than within industries, and this in turn may suggest a link between knowledge spillovers and diversity” (p. 26). Even though Jacobs and Marshall have diﬀ erent opinions about

the ideal nature of the city - diversity versus uniformity - they agree upon the fact that a large agglomera on has advantages regarding knowledge exchange. This thought is founded on the concept that our knowledge is based on ideas from the people around us (Gleaser, 2010). Nevertheless, knowledge spillovers are diﬃ cult to iden fy and to qualify. Unlike input sharing, for instance, knowledge cannot generally be measured and is neither bought nor sold (Henderson & Thisse, 2004).

2.1.2 Economies of scale to residents

Alongside advantages rela ng to produc on and knowledge of an agglomera on, Raspe (2012) argues that residents might also profi t from the concentra on of suppliers. With the no on of a “consumer city” Glaeser, Kolko and Saiz (2001) claim that residents of larger agglomera ons profi t from urban-specifi c consump on opportuni es. These consump on occasions, such as a museum, event, opera or sport club “need large

audiences to be successful” (p. 9). A diverse supply of shops and restaurants is also an advantage, as

restaurants, for instance, may specialize in a wide range of cuisines. Certainly in a me where companies are footloose and mobile, “the success of ci es hinges more and more on ci es’ role as centers of consump on” (p. 1).

Raspe (2012) also men ons the “home market” as an advantage. In a large agglomera on, companies can produce their products more cheaply as result of rela vely large-scale produc on. This makes it more a rac ve for companies to establish themselves in such regions, and residents benefi t from the increased choice of products and services. Nelson (1958) uses the theory of cumula ve a rac on to explain that consumers want to compare products before deciding which to buy. The driving idea is that consumers act in a “risk reducing” fashion. Accordingly, residents benefi t from the clustering of suppliers. Furthermore, Bolt (1995) argues that economic ac vity leads to a more a rac ve business loca on for new ac vi es.

2.2 A rac veness of the region

Investment in the leisure industry is generally made to gain money, and might also lead to a more a rac ve region. However, this does not necessarily mean that residents benefi t from this more a rac ve region. Rajinder (2000) conducted research on the diﬀ erences between the percep on of Simla, a hill sta on in northern India, by tourists and residents. He argues that residents perceive their living area in a diﬀ erent way to tourists. Residents appreciate intangible characteris cs, while tourists look to tangible elements. Tourists want to see “things” while residents have a greater apprecia on for the atmosphere.

2.2.1 A rac veness for residents

Municipali es have an obsession for growth, and in order to grow ci es need to be a rac ve (Hospers, Verheul, & Boekema, 2011). A rac veness is challenging to quan fy and a broad variety of ideas exist about what is a rac ve. These ideas can o en be derived from an author’s background; for instance, economist Edward Glaeser claims that a city’s a rac veness is related to employment. “The reality of urban life

throughout most of history is that people didn’t come to ci es for their pleasure” (Glaeser, 2015, p. 3). S ll,

ci es a racted people from the suburbs, which might indicate the economic strength of these clusters. A er a period of suburbaniza on, which denoted the popula on shi from urban centers into rural areas as result of increased prosperity and car ownership, re-urbaniza on took place. Ci es became safer and became places of pleasure, and people who believed they could also make money outside the city underes mated the social network within it. “We are a social species that gets smarter by being around other smart people,

and that’s why ci es thrive” (p. 21). The choice to live in the city is therefore o en economically mo vated.

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In American literature, scholars argue that correla on exists between an increase in popula on and the a rac veness of a city. In the Netherlands, this correla on is diffi cult to observe because policies of the Dutch na onal government signifi cantly infl uence the a rac on of new residents. For example, the government “created” Nieuwegein, Zoetermeer and Almere [groeikernen] to reduce the pressure on a rac ve regions like Amsterdam and Utrecht (Marlet, 2009). An a rac ve, successful city is a city in which people like to reside and where companies like to be located, and has possibili es for everyone (Marlet, 2015). There is a diff erence between being successful and being a rac ve - success rests on economic aspects like employment, growth and produc vity, while a rac veness is based on natural surroundings, recrea on and urban a rac ons - but Marlet combines the two no ons. In his book “De Aantrekkelijke Stad” Marlet analyzes success factors of Dutch ci es and uses an a rac veness index to reveal why some ci es are performing be er than others. He acknowledges the economic aspects of being successful and hence uses a rac veness and success. Unlike Glaeser, Marlet examines specifi c city a rac ons which impact a rac veness separately from economic factors. City a rac ons are features that residents take into account when choosing a place to live. He divides these a rac ons into three categories: “housing and the surrounding area,” “urban area” and “city’s surrounding area.” The fi rst is related to the quality of housing on off er and of the surroundings, which are spaces where children play and people walk their dogs. Safety and the presence of schools and local parks are at the forefront of this perspec ve. Second, the urban area encompasses specifi c urban a rac ons such as musicals, museums, fes vals and a diverse supply of shops. The presence of a historical city and a football club also make a city a rac ve. In the wider region, recrea onal ac vi es and natural areas are essen al. However, not every aspect infl uences the behavior of poten al house buyers. According to Marlet, the following a rac ons correlate with the behavior of residents: variety of performing arts, culinary quality of restaurants, presence of a historical inner city, accessibility of nature, presence of a successful football team and a rela vely low occurrence of violent crime. Other factors like shops, sport fi elds and cafes are essen al, but not dis nc ve from other ci es. The reason that fes vals, musicals and museums are less important is that local residents are not their exclusive audience. The importance of these a rac ons for the “living behavior” of residents indicates the change from a produc on city to a consumer city (Marlet, 2009; Vroege, 2010).

In his book Marlet also men ons the importance of culture in luring the crea ve class, as introduced by Richard Florida. The crea ve class not only includes crea ve minds, but also highly educated individuals working in science, IT and law fi rms, among others. However, inves ng in culture does not always lead to a rac ng the crea ve class. Small and diverse investments aimed towards local residents increase the a rac veness of the city for residents. Cultural events such as museums, musicals and fes vals do contribute to the cultural life of the city, but have no infl uence on the a rac on of the crea ve class (Vroege, 2010; Marlet & Woerkens, 2005).

Scholars typically focus on the city, while the rural also deserves a en on as there is a synergy between the urban and rural area (Marlet, 2015). Rixt Bijker wrote a disserta on about migra on to less popular rural areas, because according to her most researchers focus on popular rural areas or ci es. She demonstrates the popularity of the region using housing prices. In the Netherlands, it is more appropriate to consider a rac veness than using in-migra on numbers for the reason that policy has a considerable infl uence on popula on growth. Bijker revealed diﬀ erences between more popular (a rac ve) and less popular regions by evalua ng landscape characteris cs, accessibility, employment in recrea on-related services, sociocultural characteris cs and future popula on development. Her research fi nds that popular rural areas are be er connected to urban centers in the central Netherlands, have a higher average income and expect household growth. Furthermore, she also confi rms that employment, cheap housing and the presence and accessibility of ameni es are crucial elements for popularity (Bijker & Haartsen, 2012).

2.2.2 A rac veness for tourists

Rajinder (2000) demonstrated that tourists have a diﬀ erent view of a des na on to locals. Tourists pay more a en on to tangible elements within a region, and especially note things that are diﬀ erent to their homes. John Urry (2002) agrees and describes the following trend:

“the Internet has had the eﬀ ect of diminishing the need for bodily contact between individuals. (...) co-presence, and hence travel between people and places, is necessary for the making of

connec on: legal, economic, familial obliga ons; social obliga ons (for developing understanding

and trust); me obliga ons (with signifi cant others), object obliga ons (for example, to sign a

contract); place or event obliga ons (tourism and leisure)” (Bridge & Watson, 2010, p. 101).

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Urry’s “The Tourist Gaze” (2002) discusses a set of expecta ons that tourists have of a des na on. The theory states that their mo va on is the search for authen c experiences and the wish to gaze upon diﬀ erent scenes, landscapes or landmarks. The search for authen city has been discussed over the years, because local governments and local popula ons respond to this gaze by giving tourists the experience they demand, thereby strengthening the stereotypes that tourists have. Moreover, tourism is increasingly focused on “must-sees.” Tourists want to take a nice picture of the well-known a rac on of a par cular area and are less engaged in searching for an authen c experience (Urry, 2002). Tourists play their own role by con nuously collec ng and comparing hotspots, which Dean MacCannel (1984) calls the “sight sacraliza on.” The fi ve stages of naming, framing and eleva on, enshrinement, mechanical reproduc on and social reproduc on transform sites into sights and lands into landscapes (Fine & Speer, 1985). These no ons are o en described as a destruc ve process, wherein commodifi ca on has a nega ve impact on the value people a ach to the a rac on. Despite this, the gaze can also boost its iden ty by giving it more a en on (MacCannell, 1984).

Commodifi ca on is a no on introduced by Karl Marx and has spread among a plurality of theore cal perspec ves. The original concept of Marx had a rather nega ve connota on related to capitalism, but the concept is now used broadly as its meaning has expanded enormously (Castree, 2003). Talking about commodifi ca on generally refers to the “conversion of a whole class of goods or services into commodi es

and a resul ng stream of sales” (Leys, 2001, p. 87). The general thought that “‘the commodity status of a thing, object, idea, creature, person or what-have-you is not intrinsic to it but, rather, assigned’ is without discussion the core of Marx’s no on of commodifi ca on and is also accepted among scholars” (Castree,

2003, p. 277). Shepherd (2002) describes the no on even more briefl y as “anything that sa sfi es a human want” (p. 186).

To examine the experiences of tourists visi ng a place, the visitor journey can be enlightening. This approach is intended to develop tourism strategies, but could be valuable to explain how visitors perceive a city and which aspects play a role in this. The visitor is followed through various stages, the number of which diﬀ ers from scholar to scholar, but in essence the following stages are used: managing understanding informa on and communica on; managing the booking process; managing access to the des na on; managing the des na on experience; managing the visitor exit; and managing the quality of the visitor memory (Lane, 2007). Thus, the experience of the des na on itself is only a part of the complete experience. All the stages are part of the journey and are possible reasons to turn the journey into a nega ve experience.

2.3 Popula on decline

Depopula on or popula on decline is the reduc on of popula on over me in a certain region. Depopula on has occurred frequently in history, but the decline has never been structural as it is in most developed countries today. Wars, diseases (e.g., the Black Death) or for example the bankruptcy of a major employer (e.g., the disappearance of the American auto industry in Detroit) are reasons for a temporary decline. Depopula on is a rela vely new phenomenon, but is not unique to certain regions in the Netherlands. The UN expects the global popula on to start declining in 2075 (Derks, Hovens, & Klinkers, 2006). Europe and other western countries like Japan are already facing depopula on as a result of decreasing or delayed fer lity (Derks, Hovens, & Klinkers, 2006; Consultancy.nl, 2016). Some regions, especially peripheral regions, have already been experiencing popula on decline for a longer period of me (Haartsen & Venhorst, 2010). Overall, popula on decline is a complex phenomenon because the causes, situa ons and consequences diﬀ er from region to region.

Dutch perspecƟ ve on populaƟ on decline

The popula on on a na onal level an cipates steady growth un l 2040. Between 2030 and 2040, the number of deaths will outnumber the number of births, but un l 2040 this can be compensated by migra on (De Jong & Van Duin, 2010). However, several regions in the Netherlands are already facing the consequences of depopula on. The central government has named nine regions of depopula on and 11 an cipa ng regions. The regions of depopula on face a decline of about 16% un l 2040, while the an cipa on regions “only” expect a decline of 4% un l 2040. The number of regions in the Netherlands facing popula on decline has grown and will con nue to grow in the coming years (Rijksoverheid, 2017). Table 1 shows which regions and provinces are already undergoing popula on decline.

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Region Type Year of peak residents Number of residents in peak year Residents per 1/11/15

Total popula on decline since peak *** Parkstad Limburg Region of depopula on 1997 272,000 246,000 -9.5% Northeast Groningen* Region of depopula on 2003** 236,000 222,000 -5.9% Western Mijnstreek Region of depopula on 1998 156,000 148,000 -5.2% Zeeuws-Vlaanderen Region of depopula on 2003 108,000 106,000 -2.4% Maastricht-Mergelland Region of depopula on 2001 212,000 208,000 -2.2% Northeast Friesland Region of depopula on 2006 127,000 124,000 -2.0% Achterhoek Region of depopula on 2005 302,000 298,000 -1.5% Limburg Province 2002 1,143,000 1,117,000 -2.3% Drenthe Province 2011 491,000 489,000 -0.6% Friesland Province 2011 647,000 646,000 -0.2% Zeeland Province 2011 382,000 381,000 -0.1%

Table 1. Depopula on in regions of popula on decline since peak year: source (Derks, 2016)

1. * The regions of depopula on De Marne, East Groningen and Eemsdelta are combined in this table given the low popula on values in those regions

2. ** Northeast Groningen previously witnessed a peak year in 1981 3. *** Calculated with unrounded numbers

Table 1 presents the nine regions of depopula on (northeast Groningen is a combina on of three regions) and demonstrates that the depopula on is structural. Parkstad has lost almost 10% of its popula on since 1997, but was not the fi rst region to decline. In fact, the fi rst structural popula on decline took place in northeast Groningen in 1981 (Derks, 2016). This table also indicates that four provinces are currently dealing with a declining popula on. The city of Groningen is preven ng depopula on in the province of Groningen. Contemporary research from CBS reveals that the popula on of the province of Groningen declined by 175 in 2016 (De Haan, Janssens, & Elshof, 2016a).

Reasons for populaƟ on decline

Van Dam, De Groot and Verwest (2006) argue that sociocultural reasons, such as individualiza on and emancipa on, infl uence natural popula on growth and migra on. The emancipa on of woman is related to a higher level of educa on, their will to be employed and the acceptance of contracep on. The current fer lity rate is 1.7-1.8, while a fer lity rate of 2.1 is required to maintain the current popula on (Dam, Groot, & Verwest, 2006). Having children at a later age relates to both emancipa on and individualiza on and also aﬀ ects the number of children that couples have (Dam, Groot, & Verwest, 2006; Derks, Hovens, & Klinkers, 2006). Professor Warren Sanderson of Stony Brook University explains this phenomenon by men oning demographic transi on. Previously, death rates had to be compensated by high birth rates. However, with the signifi cant decline of the death rate in the modern age of technology, birth rates have declined simultaneously (Wise, 2013).

In addi on to popula on decline, a nega ve balance is also in place concerning migra on. People generally leave peripheral regions for work- and study-related reasons. Other reasons to leave a region relate to health, marriage or divorce and the environment. However, the percentage of people leaving the periphery to study and work are above average (Feijten & Visser, 2005) ,which can be explained by economic factors and planning. The la er plays a role in migra on, because migra on is mostly caused by the a rac veness of the city. The role played by economic factors in demographic transi on is evident from research demonstra ng that economic conjuncture infl uences the birth rate. Upon the upwards movement of GDP the consumer has more confi dence in the economy, and research shows that the number of births

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is higher during these mes. This economic development is also essen al for migra on. Furthermore, it can also be related to an ageing popula on, as increased prosperity and technological and societal developments lead to increased life expectancy.

Demographic transiƟ on

In contrast to many countries in Eastern Europe, the Russian Federa on, Germany, Italy and Japan, the Netherlands is not experiencing a natural na onal decline (Coleman & Rowthorn, 2011). Popula on decline is not an isolated phenomenon. It is therefore useful to look at simultaneously occurring developments. Remarkably, popula on decline mostly aﬀ ects border regions and peripheral areas in the Netherlands as young people leave these border and rural regions to study or work in the city. A decreasing number of young people in a region is called dejuvena on, which strongly correlates with depopula on and o en accompanies a so-called “brain drain.” Brain drain is the result of educated people going to the city, o en young people, because the city has more op ons for high-quality jobs (Van Eck, Dam, & de Groot, 2013). Popula on decline cannot be viewed apart from an ageing popula on. These two processes do not have a causal rela on, but they share a common cause: a reduced number of births (Coleman & Rowthorn, 2011). The elderly have an increased life expectancy, which indicates that ageing is not purely the result of a decreased number of births. These are all causes of the altera on of the age pyramid, but other processes also play a role, for instance dejuvena on (Dam, Groot, & Verwest, 2006). Like popula on decline, ageing is seen as a problem by the government. In Japan, for instance, the percentage of people above 60 is 28% (the highest number in the world), while the number of births is rela vely low and the country is nearly closed to immigrants. In turn, this leads to a more vulnerable economy. This economic vulnerability is also one of the fears of the Dutch government (Dalen, 2008). Depopula on, dejuvena on and an ageing popula on combine to produce “sub-replacement fer lity,” which means that the current popula on is not able to maintain its current popula on and is becoming older.

In research about the housing market, scholars talk about household decline rather than popula on decline. The reason for this is that individualiza on also aﬀ ects the housing market. Locally, a household decline, which correlates strongly with the demand for housing, leads to vacancy and the segrega on of par cular (low-income) groups (Van Eck, Dam, & de Groot, 2013).

2.3.1 Popula on decline in the Eemsdelta

The Eemsdelta is located in northern Groningen. As shown in Table 1, the Eemsdelta along with two other Groningen regions comprise three of the nine regions of popula on decline. Popula on decline is structural in the Eemsdelta and the region con nues to depopulate (Derks, 2016). Where Limburg sees strong

Figure 2. Popula on decline in the Eemsdelta. Source: own fi gure based on data from Planbureau voor de Leefomgeving, 2016

Expected percentage of decline 2015-2040 Eemsmond -5.3%

Loppersum -8.0% Appingedam -5.2%

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depopula on as a result of demographic developments, popula on decline in the northern part of the Netherlands is the outcome of migra on (Gardenier, 2012). In the peripheral region of Groningen, especially the Eemsdelta, young people are going to the city to study or work. Tony Fielding uses the metaphor of the escalator to show the fi gura ve steps taken by youngsters on an escalator to a ain higher educa on and employment in order to improve their socioeconomic status (Fielding, 1992). With this no on, he also argues that youngsters return as soon as they start having children and become wealthier. It seems that this fi nal stage is no longer applicable due to the increased possibili es for families to stay in the city (PBL, 2015). Even though the situa on of Appingedam can be ques oned, as some documents reveal a slight increase in the popula on, the general view is that all four municipali es within the Eemsdelta - Delfzijl, Appingedam, Eemsmond and Loppersum - face a depar ng popula on (Figure 2). With the excep on of a few years, the popula on of the whole region has been declining since 1981 (Verwest, Sorel, & Buitelaar, 2008) and this trend will con nue un l 2040. The popula on is then expected to have declined by 34% and the number households by 17% (Iersel, Schaar, & Wildt, 2010). Meanwhile, other demographic transi ons also aﬀ ect the Eemsdelta. The number of people aged above 75 years will increase by 60%, with a rejuvena on value of about 35%. Through this combina on the working popula on will decline by 37% within 25 years (KKNN, 2012). These demographic transi ons have many nega ve consequences for the region, from closing facili es to the vacancy of houses and shops. Several plans and programs are in place to deal with popula on decline, and are not intended to stop these transi ons but to facilitate and mi gate the consequences of these phenomena. For instance, the development concept [ontwikkelingsvisie], established by the provincial government of Groningen and the four municipali es, aims to prevent depopula on from aﬀ ec ng the livability and spa al quality of the environment (Provincie Groningen, 2013).

Earthquakes

In addi on to the demographic transi ons described above, residents are also suﬀ ering from the consequences of earthquakes. Since 1962, the Dutch state oil and gas company [Nederlandse Aardolie Maatschappij] has exploited the gas fi elds in Groningen. Gas extrac on opera ons cause regular earthquakes in the northern Netherlands. The combina on of demographic transi ons and earthquake issues make this region unique and complex (Economic Board Groningen, 2017). Like popula on decline, earthquakes also impact the perceived livability by residents (De Haan, Janssens, & Elshof, 2016). However, no causal rela on has yet been found between popula on decline, i.e., demographic transi ons, and earthquakes issues.

2.3.2 Popula on decline and economies of scale

The discourse on economies of scale is essen ally related to urban regions and is aimed towards popula on increase. Diﬀ erent perspec ves within this discourse emphasize the benefi ts of clustering and having a large agglomera on. However, it is crucial that these benefi ts do not stop at the borders of a city or municipality, because municipali es near a large city also profi t from the urban supply (Figure 3). Due to the fact that the willingness to travel is limited, municipali es near the city profi t more from this than peripheral regions. Meanwhile, at a country’s border the urban supply has barely any impact on neighboring municipali es. Hence these borders are juridical, social and cultural barriers for residents. Agglomera ons in border regions, in addi on to municipali es bordering the sea, are therefore much smaller than centrally located places (Figure 4). These regions are less a rac ve and more o en aﬀ ected by popula on decline, ageing, dejuvena on, brain drain and higher unemployment rates (Marlet & Van Woerkens, 2013).

Figure 3. Agglomera ons (normal). Source: Marlet and Van Woerkens, 2013

Figure 4. Agglomera ons (near a country border). Source: Marlet and Van Woerkens, 2013

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Hospers (2010) uses the theory of cumula ve causa on to demonstrate that growing regions will con nue to grow and that popula on decline leads to popula on decline. Instead of a virtuous circle, a region of popula on decline experiences a vicious circle and detrimental results (Elshof, 2017). This is explained through reversing the scales of economies of a large agglomera on. Isolated companies can profi t less from “input-sharing” (Henderson & Thisse, 2004); small agglomera ons more o en lead to a mismatch between employer and employee; more highly educated people leaving the region has a nega ve eﬀ ect upon knowledge spillover. To summarize, a smaller agglomera on is less a rac ve for companies (Florida, 2003). A smaller agglomera on also has a nega ve impact on residents, as it leads to fewer employment opportuni es and city-specifi c a rac ons. Hence new investments could be essen al in this type of area, as Bolt (1995) argues that this contributes to an area with more economic ac vity.

2.3.3 Popula on decline and a rac veness

As discussed in the previous paragraph, a large agglomera on a racts residents with economies of scale. Within the discourse surrounding a rac veness, it is not disputed that a rac veness impacts the increase or decrease of the popula on (De Graaff , Van Oort, & Boschman, 2008). Using the cumula ve causa on theory, it can be assumed that an una rac ve region facing the consequences of depopula on will become even less a rac ve in the future. This is based on the fact that popula on decline aff ects elements that make a city a rac ve. The approach of Marlet (2009) falls short in considering the a rac veness of rural areas. He argues that shops and sports fi elds are not essen al for a rac veness because they are located in all ci es. However, this is a problem in regions experiencing popula on decline. In contrast, Bijker’s research specifi cally focuses on una rac ve regions in the northern Netherlands, which makes Bijker’s research more useful. She qualifi es a rac veness using house prices and uses this division to look for diff erences between a rac ve and una rac ve regions. Loca on near to a large city and the accessibility of facili es are, next to employment, the most crucial elements in a rac veness (Bijker & Haartsen, 2012). Later research by Marlet confi rms the need for a connec on with the city. He uses northern Groningen to explain that poor connec vity results in a depopula ng region (Marlet, 2015). Furthermore, the elements men oned by Florida and Marlet are essen al because this indicates what people are generally interested in. Burger and Van Oort (2014) therefore argue that ci es should focus on their own strengths.

2.4 Leisure industry

The second focus of this Master’s thesis is the leisure industry. Aristotle (384-322) made the connec on between happiness and leisure and said that we “labor to have leisure” (Zillmann & Vorderer, 2009, p. 8). In this line of argumenta on, these two words are the opposite of one another, which can be confi rmed by the La n transla ons of the words leisure (o um) and work (nego um). To the Romans and the Greeks, leisure was seen as “ me oﬀ work,” and as people had more money to spend and more spare me the leisure industry grew (Brotherton, 2008). The contemporary defi ni on of leisure can be traced back from the Greeks and the Romans. The Cambridge Dic onary (2017a) defi nes it as “the me when you are not

working or doing other du es.” Without responsibili es or du es, people voluntarily do something that

pleases them. This defi ni on includes both tourism and recrea on. A lack of clear defi ni ons for these two terms leads to confusion (Zillmann & Vorderer, 2009). Tourism is diﬀ erent from recrea on, as tourism can be associated with work and recrea on occurs during free me. Tourism is about visi ng another place and always occurs outside the home community. The associa on between tourism and making profi t is also much stronger than in the case of recrea on. Its defi ni on, “the business of providing services such as

transport, places to stay, or entertainment for people who are on holiday” (Cambridge Dic onary, 2017c)

makes clear that tourism has a strong commercial aspect. In contrast, recrea on can take place near the home community and the commercial aspect is less strong, because recrea on ac vi es can be provided by the government (or other ins tu ons) for free (Zillmann & Vorderer, 2009). Moreover, the defi ni on of leisure strongly correlates with the defi ni on of recrea on: “enjoying yourself when you are not working” (Cambridge Dic onary, 2017b). The diﬀ erence, but with some overlap, is that recrea on is about doing something for fun while tourism is about visi ng another place. In this thesis the focus is on tourism as recrea on.

Current situaƟ on of the leisure industry in the Eemsdelta

In 2015, tourism revenue in the Dutch economy increased by 3.7%. Furthermore, the ING Economisch Bureau (2016) expects the importance of the tourism industry for the Dutch economy to grow. These revenues are unevenly distributed, as some provinces take more profi ts from this industry than others. The

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ING Tourism Index provides a good indica on of the leisure industry in the region. The index is composed of two elements: overnight stays and the loca ons of hospitality or a rac ons. These numbers are placed alongside the number of residents and merged to produce a certain index number, which can then be compared with other provinces. Figure 5 reveals that Groningen is less represented in the tourism industry, taking into account its small popula on (ING Economisch Bureau, 2016).

Tourism numbers

Even though Gelderland has a nega ve ING Tourism Index, it is the most visited province of the Netherlands by Dutch people, while Groningen is by far the least visited province. In Table 2, Groningen is compared to Gelderland and neighboring provinces in the Netherlands (NRIT Media, CBS, NBTC Holland Marke ng & CELTH, 2016).

x 1,000 Long vaca on (4+ days) Short vaca on (2-4 days)

2002 2015 2002 2014 The Netherlands 9,200 7,880 9,510 9,110 Groningen 150 140 230 230 Friesland 790 580 650 620 Drenthe 850 790 710 730 Gelderland 1,540 1,440 1,450 1,490

Table 2. Number of domes c vaca ons in 2002 and 2015. Data based on CVO, NBTC-NIPO Research

Research from ING indicates that Groningen is lagging behind in terms of the number of overnight stays. In 2015, Groningen had about 1.5 million overnight stays (in days) while neighboring provinces had 5.4 million (Friesland) and 6.6 million (Drenthe). However, the growth of the leisure sector in Groningen is the fastest at 14% (ING Economisch Bureau, 2016). Also remarkable is the supply of overnight accommoda on in

Figure 5. ING tourism index. Sources: ING Economic Bureau, 2016

Far above average Above average Beneath average

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Figure 7. Development of the number of recrea onal touris c facili es per region of popula on decline. Source: Goossen,

Groningen, as shown in Table 3 (NRIT Media, CBS, NBTC Holland Marke ng & CELTH, 2016). The number of touris c facili es is growing less quickly in depopula ng regions than in the rest of the Netherlands (Figure 6). In this respect, Figure 7 shows that the Eemsdelta is far behind other regions of popula on decline.

x 1,000 Total Hotels/pension/youth accommoda on

Campsites Holiday parks Group

accommoda on The Netherlands 1,369 261 758 594 56

Groningen 29 6 19 4 1

Friesland 102 12 62 18 9

Drenthe 110 6 70 28 5

Table 3. Supply of sleeping accommoda ons in 2016. Data based on CBS, 2016

Figure 6. Development of the number of recrea onal touris c facili es. Source: Goossen, Kuhlman and Breman, 2012

Regions of depopula on and an cipa ng regions Remaing part of the Netherlands

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Most interna onal tourists visi ng the Netherlands are from Germany, followed by the United Kingdom and Belgium. Even though most of these tourists go to the four largest ci es in the Netherlands and to seaside towns like Scheveningen (NBTC, 2012), the percentage of foreign tourists in Groningen was about 30% in 2016 (ING Economisch Bureau, 2016). Nevertheless, Groningen is the least visited province among foreigners, despite the fact that it borders the largest foreign tourism market of the Netherlands (Table 4). It is obvious that the touris c pressure per km2 is also lowest in Groningen. This is based on the number of visitors per day per km2. In 2015 the pressure index in Groningen was 1.8, 4.4 in Friesland and 6.8 in Drenthe; these values indicate low touris c pressure in comparison with the average value for the Netherlands, 8.4, with a peak in Noord-Holland of 26.3 (NRIT Media, CBS, NBTC Holland Marke ng & CELTH, 2016).

x 1,000 Total Dutch Foreign

Guests Over-night Average stay Guests Over-night Average stay Guests Over-night Average stay The Netherlands 37,318 103,534 2.8 22,311 66,237 3.0 15,007 37,298 2.5 Groningen 653 1,496 2.3 454 1,050 2.3 199 446 2.2 Friesland 1,606 5,372 3.3 1,304 4,125 3.2 302 1,247 4.1 Drenthe 1,628 6,513 4.0 1,420 5,710 4.0 208 803 3.9

Table 4. Number of guests and overnight stays per province and origin in 2015. Data based on CBS, 2016

The previous values were based on the whole province, but the city of Groningen a racts a large propor on of tourists. Table 5 shows that the city of Groningen is for a large part responsible for the number of tourists in the province. This suggests that there are very few tourists or visitors in the rest of the province, the Ommelanden (Con nuVakan eOnderzoek, 2011).

Groningen (city) Ommelanden Groningen (province) The Netherlands Short vaca on 79 134 213 9,479 Long vaca on 25 155 180 8,262

Total number of vaca ons 104 289 393 17,741

Total number of overnights 315 1,402 1,717 91,707

Total costs vaca on (x 1,000) 15,707 37,666 53,373 2,754,376

Cost per vaca on per person (average) 152 130 136 155

Cost per vaca on per person per day (average)

37.5 22.3 25.3 25.2

Table 5. The city of Groningen compared to the rest of the province and the Netherlands concerning visi ng tourists in 2010. Data based on Con nuVakan eOnderzoek 2010-2011, 2011

1. Note: numbers may diﬀ er from study to study, but these numbers do provide a good indica on of the propor on of tourists per province/region in rela on to the Netherlands and the city of Groningen

Con nu Vakan e Onderzoek (2011) conducted research on the background and interests of tourists and visitors of Groningen (the province). Tourists visi ng the province (city excluded) went to natural areas (38%), museums (27%), buildings with cultural and historical value (26%), a certain park such as a botanical garden (19%), a beach (13%), folkloris c events (12%) and several other a rac ons. The ac vi es they do are strongly related to the addressed segments, which are associated with the rural areas of northern Groningen (Appendix 2). Walking, swimming, shopping and going out for dinner, alongside water ac vi es (fi shing and canoeing), are mostly undertaken. The age category also relates to the segments. About 32% of tourists are 65 years or older, which is 15% higher than the overall value for the Netherlands. The number of families without children above 35 years is the most common group (46%) in the Ommelanden. However, this is quite normal in the Netherlands (45%). The group of parents with younger children of 0-5 years (12%) and 6-12 years (10%) are also comparable to overall values in the Netherlands (12% and 11%). In the development concept [Ontwikkelingsvisie] for the Eemsdelta it is noted that 16% of touris c overnight stays

Socioeconomic Benefits from Investments in the Leisure Industry

Socioeconomic benefi ts of investment in the

leisure industry

In what way does a region of popula on decline benefi t from

investment in the leisure industry: Case of the Eemsdelta

Socioeconomic benefi ts of investment in the

leisure industry

In what way does a region of popula on decline benefi t from

investment in the leisure industry: Case of the Eemsdelta

Dirk van de Ven

S4635604

June 2018

Preface

Summary

Table of Contents

List of tables and fi gures

Figures

Tables

Chapter 1. Introduc on

Chapter 2. Theory

2.1 Economies of scale

2.1.1 Economies of scale to investors

2.1.2 Economies of scale to residents

2.2 A rac veness of the region

2.2.1 A rac veness for residents

2.2.2 A rac veness for tourists

2.3 Popula on decline

2.3.1 Popula on decline in the Eemsdelta

2.3.2 Popula on decline and economies of scale

2.3.3 Popula on decline and a rac veness

2.4 Leisure industry