Who Gains from Structural Change? The Distribution of the Benefits of Oil in Aberdeen

Abstract

This paper analyses the distributional impact of oil upon the Aberdeen economy. It is suggested that the benefits of oil related activity have been very unevenly distributed. Increased real earnings have been mainly confined to groups active in the oil sector. For others, including most women, real earnings remain below the national average. The wealth which oil related activity has brought to Aberdeen has been partly diffused through the housing market, although the gains from increased house prices have largely accrued to those who were already owner occupiers when oil developments began. For much of the period, a low rents policy has protected council tenants from the increased cost of living caused by oil developments, but recent legal changes which limit the subsidy of rents from the rates have now removed that protection.

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