The Role of Bioeconomy Sectors and Natural Resources in EU Economies: A Social Accounting Matrix-Based Analysis Approach

Abstract

Abstract:The bio-based economy will be crucial in achieving a sustainable development, covering all ranges of natural resources. In this sense, it is very relevant to analyze the economic links between the bioeconomic sectors and the rest of the economy, determining their total and decomposed impact on economic growth. One of the major problems in carrying out this analysis is the lack of information and complete databases that allow analysis of the bioeconomy and its effects on other economic activities. To overcome this issue, disaggregated social accounting matrices have been obtained for the highly bio-based sectors of the 28 European Union member states. Using this complex database, a linear multiplier analysis shows the future key role of bio-based sectors in boosting economic development in the EU. Results show that the bioeconomy has not yet unleashed its full potential in terms of output and job creation. Thus, output and employment multipliers show that many sectors related to the bioeconomy are still underperforming compared to the EU average, particularly those with higher value added; although, they are still crucial sectors for the wealth creation.

A Re-Examination of the Structural Diversity of Biobased Activities and Regions across the EU

“…Building on the seminal work of Müller et al [11], Mainar and Philippidis [3] update to the year 2010 and further augment the biobased sector accounts to encompass additional sources of biomass, as well as contemporary applications of biomass in the fields of liquid fuels, electricity and chemicals. The resulting BioSAMs have been subsequently employed by Fuentes-Saguar et al [14] to calculate output and employment multipliers for biobased activities in the 28 EU MS. Simply employing mean multiplier values, the authors compare with the EU bloc average.…”

“…This study also employs the BioSAMs to undertake a structural analysis of the EU MS biobased sectors, although it improves on the study by Fuentes-Saguar et al [14] in two ways. Firstly, following other relevant studies [12,13], the current study calculates both backward-linkage (BL) and forward-linkage (FL) multipliers (see Section 2 and Supplementary Materials), which in comparison with Fuentes-Saguar et al [14], yields a more comprehensive picture of the structural influence of the biobased economy. On the one hand, the sum of the total BL multiplier effect from a given sector 'j' is equivalent to the output multiplier, as both represent the cumulative value of economic activity resulting from an additional unit of final demand for a given commodity [15,16].…”

“…On the other hand, further structural insights are attained from using total FL multipliers, which characterize an input multiplier effect based on the change in output of all sectors given an additional unit of available input from activity 'j' [15,16]. In addition, Fuentes-Saguar et al [14] do not examine in any detail, specific cases of high (or low) performing biobased sector and region combinations. In the current analysis, this is performed by normalising the BL and FL multipliers to generate indices of influence (see Section 2.2), which in turn are used to identify the presence of 'key' biobased sectors (i.e., high performers).…”

Analysis on Bioeconomy’s Contribution to GDP: Evidence from Japan

“…However, the short-run relationship cannot be confirmed in two out of the three models. One possible reason for this finding is that the concept of bioeconomy is long-term in nature [58], and has not yet unleashed its full potential [25]. Another important reason may be that bioproducts have not fully hit commercialization [59], and consumers are generally unfamiliar with bio-based products [60].…”

“…Several studies have advocated for a study such as the one presented in this paper. For instance, Fuentes-Saguar et al [25] indicated that in the context of the growing relevance and interest in the bioeconomy across the world, research work that provides significant information on the structure of activities and their links with gross domestic product (GDP) has acquired greater importance. Also, the German Bioeconomy Council [26] stated that insights into the expectations, drivers, and barriers related to sustainable bioeconomy around the world are essential for international policy and collaboration.…”