Innovation dynamics in the biobased industry

This paper studies the biobased industry evolution as an innovation process, as this approach allows us to widen the current perspective of most literature in this field, by offering insights into the current mechanism as well as the future possibilities of this industry. This new industry, which is still in its infancy, conceals a number of interrelated alternatives in four key dimensions: raw materials, conversion technologies, products, and business models. Considering an emerging industry, the selection environment is complex and the competitive patterns are not yet established. Product and process innovations occur intensely without the existence of dominant designs or enabling technologies. Entry and exit barriers are low, with coexisting innovators from different knowledge backgrounds proposing several concepts and building diverse technological trajectories. In this context, Brazil seems to possess some comparative advantages due to its experience in first-generation ethanol production and related agricultural developments, as well as the successful experience with green polyethylene. Nonetheless, this country faces important challenges concerning the four key dimensions explored in this paper. As the biobased industry develops, government support and private initiatives need to align in order to move the country to a prominent position.[Figure not available: see fulltext.]. © 2014, Bomtempo and Alves; licensee Springer.