The Emergence of the Biobased Economy
Jay Golden from Duke University and I have been working on a study of the biobased economy….
Throughout human history agriculture been used for non-food purposes including energy, clothing, shelter, medicines and every day human needs. With the industrial revolution, man was able to achieve great scientific and technological advances were available through the utilization of non-renewable resources that has been vital to the economy of the United States. As an example, in the 1950s, the U.S. chemical and plastics industry was responsible for over 5 million U.S. jobs, and a $20 billion positive trade balance for the United States. Jobs associated with the industry were typically among the highest paid in U.S. manufacturing (Landu and Arora, 1999). The challenges of the 21st century have created new socioeconomic and resources challenges, including rapid population growth and urbanization, an expanding global middle class hungry for automobiles and modern technology, resource competition and scarcity, environmental protection and regulation, and more volatile economic cycles that impact all countries in the global economy. The emergence of these factors have served as the catalyst for the emergence of what is being termed the Bio-Based Economy. The Bio-Based Economy is characterized by a new generation of environmentally friendly materials and products and economic opportunities for U.S. based agriculture, chemical, manufacturing sectors and their value chains, with far-reaching potential impacts on socioeconomic development and the resurgence of production in the United States.
The White House defines a biobased economy as follows:
“A bioeconomy is one based on the use of research and innovation in the biological sciences to create economic activity and public benefit.”
OECD in 2009 noted that “From a broad economic perspective, the bioeconomy refers to the set of economic activities relating to the invention, development, production and use of biological products and processes. If it continues on course, the bioeconomy could make major socioeconomic contributions in OECD and non-OECD countries. These benefits are expected to improve health outcomes, boost the productivity of agriculture and industrial processes, and enhance environmental sustainability.”
Various studies have explored the economic value both globally and domestically of the bioeconomy. A 2012 release by the U.S. Biotechnology Industry Organization placed the national value at $1.25T. The European Commission (2014), estimates that Bioeconomy to be worth over EUR 2 trillion (~$2.7T), providing 20 million jobs and accounting for 9 % of total employment in the Union in 2009.
However these estimates are preliminary, and a lot of work needs to be done to better understand how the bioeconomy will impact global supply chains. There are many factors to consider which I will be sharing on this post over the summer…