Resource development, plant location, and government influence : a spatial analysis of the Australian metalliferous mineral industries
Creators: name: Fagan, Robert Harold
Publisher: name: The Australian National University
Year: 1973
Subjects: subject: Mineral industries Australia
subject: Industrial policy Australia
subject: Industrial location Australia

description: This thesis examines the development of selected metalliferous minerals in Australia and the evolution of spatial patterns of mining and processing industries. It is submitted that powers of geographical analysis are increased by considering resource development and plant location in an integrated framework, and that such a structure can be developed from classical least-cost location theory (which, in its present form, is deficient in its notions of resources). The thesis begins by considering this theory and suggests simple (informal) models to represent 'resource creation' as a spatial process. The resource creation process begins with the collection of information (exploration) and the development of mines, and culminates in the supply of metal, in usable forms such as steel and aluminium ingot, to user-industries. The remainder of this study identifies and measures the parameters of this process and argues that the evolving spatial pattern of metal resources and attendant processing industries cannot be adequately explained without knowledge of institutional factors such as vertical-integration and, particularly, the spatial influence of government policy. The empirical part of the thesis measures the main parameters of the processes for the five most important metalliferous minerals in Australia. Detailed analysis is made of demand parameters, regional production costs, transport costs, and the influence of isolation (reflected in levels of infrastructural investment by mineral companies). The aluminium industry is used as a case-study, but comparative data are drawn from the iron and steel, copper, lead, and zinc industries. The study is constructed in terms of the classical theory, and optimal patterns of location are generated for the aluminium industry using linear programming. Costs of resource development are specifically included in the models. The patterns are used as 'bench-marks' against which to test the actual patterns. The importance of critical production factors in mining and processing is stressed, and much of the deviation between actual and theoretical patterns results from institutional factors, including government policies. For the other industries, least-cost location theory (as modified) appears to have reasonable explanatory power. The study concludes with a consideration of government policies in Australia as a variable in the resource creation process, concentrating on their influence on location. Commonwealth and State governments, operating under different Constitutional constraints, have different primary goals in mineral policies, and some examples of conflict are given. Commonwealth spatial influence is restricted, and examples show that much of it is incidental or accidental. The State governments play an important role in resource creation through mining leases (in which obligations are often imposed on companies) and royalties, but exercise more spatial influence if they can manipulate the regional costs identified in the empirical part of the thesis. Despite a wide range of government influences on resource creation, much policy has had little spatial impact on patterns of mining and processing in Australia; the most pervasive influence seems to operate not directly but through other parameters. This is the most difficult institutional influence to measure, however, and calls for an improved conceptual framework before the resource creation process can be completely understood.