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Product Diversification in Sustainability Transition: The Forest-Based Bioeconomy in Finland

Author

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  • Jukka Luhas

    (Sustainability Science, School of Energy Systems, LUT University, FI-53851 Lappeenranta, Finland)

  • Mirja Mikkilä

    (Sustainability Science, School of Energy Systems, LUT University, FI-53851 Lappeenranta, Finland)

  • Ville Uusitalo

    (Sustainability Science, School of Energy Systems, LUT University, Saimaankatu 11, 15140 Lahti, Finland)

  • Lassi Linnanen

    (Sustainability Science, School of Energy Systems, LUT University, Saimaankatu 11, 15140 Lahti, Finland)

Abstract

The forest-based bioproduct field has diversified into the chemical, medical, energy, nanoproduct, and construction material sectors. This paper argues that forest-based bioeconomy has kept the focus on conventional products and new bioproducts have primarily been developed as extensions to existing product portfolios due to a lock-in mechanism, i.e., a state where an economy gradually locks itself to a dominant market position due to technical interrelatedness, economies of scale, and quasi-irreversibility of investment. The study examines forest-based product transition in the context of lock-in mechanisms through narrative analysis over the past 170 years. A theoretical framework is formulated based on complex system studies and the economics of lock-in mechanisms. The relation between the lock-in mechanisms of the regime and product diversification is described for the forest-based bioeconomy in Finland. The study supports previous findings indicating that interactions occur between the lock-in mechanisms. Furthermore, lock-in mechanisms can have a neutral, adverse, or beneficial effect on product diversification. The paper extends knowledge about the role and functioning of lock-in mechanisms in changing market environments. Recent trends in network development and foreign investment, and their effects on industrial symbiosis and product diversification, is recommendable to consider in future research.

Suggested Citation

  • Jukka Luhas & Mirja Mikkilä & Ville Uusitalo & Lassi Linnanen, 2019. "Product Diversification in Sustainability Transition: The Forest-Based Bioeconomy in Finland," Sustainability, MDPI, vol. 11(12), pages 1-19, June.
    • Handle: RePEc:gam:jsusta:v:11:y:2019:i:12:p:3293-:d:239999
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    Cited by:

    1. Rusanen, Katri & Hujala, Teppo & Pykäläinen, Jouni, 2024. "Research approaches to sustainable forest-based value creation: A literature review," Forest Policy and Economics, Elsevier, vol. 163(C).
    2. Luhas, Jukka & Mikkilä, Mirja & Kylkilahti, Eliisa & Miettinen, Jenni & Malkamäki, Arttu & Pätäri, Satu & Korhonen, Jaana & Pekkanen, Tiia-Lotta & Tuppura, Anni & Lähtinen, Katja & Autio, Minna & Linn, 2021. "Pathways to a forest-based bioeconomy in 2060 within policy targets on climate change mitigation and biodiversity protection," Forest Policy and Economics, Elsevier, vol. 131(C).

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