Accelerating the market diffusion of bio-based innovations – Evidence from expert and business perspectives and policy strategies

Abstract

Several policy strategies aim to promote the transition to a bioeconomy as a means to addressing the environmental issues of the prevailing mode of unsustainable production and consumption. Bio-based products, such as wood-based textile fibres and packaging solutions, are promoted as part of the bioeconomy due to their carbon storage capacity and their substitution effect when replacing fossil-based alternatives. However, the market diffusion of innovations in these sectors is faced by several challenges. In this study, we aim to uncover the extent to which the current innovation policy measures outlined in the bioeconomy, packaging, and textiles-related strategies at the European Union (EU) level, and by using Finland as a national-level case, match the needs of the industry and businesses engaged in the development of new wood-based bioproducts and technologies. First, we conducted a content analysis on policy strategies to identify the measures supporting innovation from the lens of a technological innovation system (TIS). Second, interviews of industry, ministry and business representatives were conducted to assess their priorities for policy support measures. According to the results, the alignment level is moderate in most of the TIS functions across the two data sources. However, TIS performance can be hindered due to inefficient policy implementation and design. The long timespan from developing an innovation to entering the market and overcoming “the valley of death” constitutes a key challenge in the upscaling phase. In conclusion, policies should have larger emphasis on accessing funding, building legitimacy of wood and global competitiveness, and alleviating regulatory uncertainty.