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Effective design of agricultural policies requires an understanding of the drivers behind the evolution of the agricultural sector. This project builds an evolutionary economic model of the Belgian agricultural sector, as a testing ground for new policies. This agent-based model simulates the dairy, cow and pig sector. The model is calibrated to historical data of production and farm diversity during the period 2003 – 2013. Profit maximising agents cannot replicate the historical trends. When assuming heterogeneous behaviours, the actual evolution can be reproduced much more closely. The calibration reveals key behaviour variables. The evolution in the agricultural sector can only be explained when accounting for a resistance to change at farm level or at market level. However, this approach cannot determine the exact location of this resistance. The resistance to change can result from personal convictions of the farmer or from market rigidities and learning effects.

This chapter explores the potential roles that business, innovation, knowledge and entrepreneurial ecosystems take to enable sustainability transitions. This conceptual research is an explorative study that shows initial research on the relation between different ecosystem types and elements of sustainability transitions. By using the socio-technical transition literature, we shed light on how the four ecosystem types influence the dynamics between niche-innovations and the dominant regime. These dynamics influence the occurrence of sustainability transitions. The research is based on a literature review of various strands of literature, that have been combined in a number of propositions. Each of these propositions offers valuable future research directions. The findings shed light on the importance for firms and policymakers to combine different ecosystem types to stimulate socio-technological niche-innovations to grow into new dominant regimes or influence the development directions of the existing regime. We discuss how policy makers and companies have to be aware that each ecosystem type has its unique characteristics and theoretical foundations, and therefore influences different elements of sustainability transitions. Our findings have important implications for future studies of ecosystem concept definitions and characteristics, ecosystem research contexts, and the interrelation with other literature streams.

Belgian pork production has faced stagnating prices for decades. It remains unclearwhether excessive market power from slaughterhouses or meat retailers has played arole in this trend. While market power studies can reveal some of the market dynamicsin this setting, this type of research has not yet been applied to the Belgian pork market.The present paper investigates oligopolies and oligopsonies in the pork productionsector. We build a new model that focuses on market power dynamics in the market forlive pigs and distinguishes horizontal and vertical market power parameters, both forpig farmers and for slaughterhouses. The results follow from an empirical applicationusing unique slaughterhouse data for 2001–2015. The results indicate that the farmersbenefit from a significant power advantage in the live pig market, when very modestprice demands are taken as a reference. The final market price of live pigs approachesthe price requested by the farmers. On the other hand, the measured vertical marketpower also suggests that a pig farmer does not receive the (modest) full-wage-basedsalary. The market power of the slaughterhouses is also limited. Market power as aresult of collusion—that is, horizontal market power—is present, but is not strong.However, there are significant differences between the slaughterhouses in terms ofmark-up on the input prices. These differences reflect differences in company strategy,and this diversity further reduces the possibility to create sector-wide collusivebehaviour.

ispartof: pages:1-200 status: Published online

Deep geothermal energy appears to be currently on the edge of a take-off in Belgium. However, the actual emergence of this technology is subject to developments in legislation and incentives from regional governments. Different risk/return expectations across stages of the investment continuum exist and the financial structures that are employed at each stage may require different types of public support. In this context, the ALPI project aims at developing a geological-economic model to calculate the impact of different policy instruments on development of the Belgian geothermal energy sector. Due to the lack of underground information describing the Campine Basin, economic methods are used to deal with these large geological uncertainties.

The issue of competition in the agri-food value chain has attracted attention in literature since the use structure-conduct-performance framework. Despite the use of several methods, the new empirical industrial organization (NEIO) models have received much attention. This study examines the NEIO approaches under the lenses of Porter’s five competitive forces. This study shows that all the five competitive forces can be estimated and are also relevant in the determination of market power in the agri-food sector. However, our assessment suggests that none of the NEIO approaches including those with major extensions capture all the competitive forces, which determine competition in any industry according to Porter. There is the need to make a conscious effort in order to account for Porter’s forces of competition. This study, therefore, provides a sort of foundation to build on for future modeling methods that estimate market power in the agri-food value chain.

In 2017 the quota system, that has regulated the European sugar beet production since 1968, will terminate. Thus, for almost 50 years farmers within the European Union were guaranteed a minimum prize, making the cultivation of sugar beet a reliable source of income. With the quota system phasing out this situation is going to change. Sugar beet prices, as well as the sugar amount demanded will increasingly depend on the global market situation. Flemish sugar beet farmers fear the milk scenario to repeat in the European sugar sector. Since many farmers only have limited attractive alternatives to sugar beet cultivation in Flanders, a drop in sugar beet prices would call farmers to strike new paths. Sugar beet is a crop employed to improve soil quality. Thus the termination of the quota does not only bring questions about economic viability but also about environmental sustainability to the fore. However, it is uncertain how the situation for Flemish sugar beet farmers will develop. In this paper we analyze the current situation of Flemish sugar beet farmers based on literature research, as well as interviews and focus groups with farmers employing systems thinking. As only two sugar refineries process sugar within Belgium we particularly focused on market power problems arising from market liberalization. Systems thinking allowed us to get a holistic view on the situation and identifying the dynamics underlying the whole system. This method, subsequently, permitted forecasting potential reactions of the system to the quota termination. Horizon 2020 grant agreement number 635577

European Union (Grant agreement no: 635577); H2020-SFS-2014-2; SUFISA

From an economic perspective the reason for unsustainable behavior is based on the existence of externalities and missing markets or common goods (Common and Stagl 2005, Wiesmeth 2012). Thus, the main focus of tackling unsustainable outcomes and behavior is on internalization (Bithas 2011, van den Bergh 2012) and on creating new markets as international endeavors in the realm of greenhouse gases or climate change (UNFCCC), biodiversity (TEEB) and land degradation (ELD) illustrate. Externalities, missing markets and common goods are one form of market failure, which influence on sustainability is well studied. Other market failures, like market power, on the other hand do not enter the field of sustainability science so far. This paper introduces the impact of market power on sustainability particularly in the agrifood sector. In doing so another economic factor is added to the analysis of sustainability, making a significant contribution to the field of sustainability science. Market power is especially of importance for the agrifood sector as concentration in this sector increases (FAO 2015). Rising concentration in the agrifood sector is accompanied by the fear of increasing prices for consumers and falling prices for farmers. Both instances may have serious implications for environmental, social as well as economic sustainability. If market power affects sustainability policy makers need to take it into account and put adequate measures in place to tackle the adverse effects on sustainability of market power. Thus, this paper discusses if and why market power should be taken into consideration as an additional economic factor influencing sustainability. In this regard an overview of sustainability and sustainability assessment as well as on market power with an focus on the agrifood sector is given. The literature review in these two areas reveals that considering market power is necessary as it can affect the social, environmental as well as economic aspect of sustainability. Therefore, it is concluded that more research in this realm is needed to further investigate the relationship, the exact manifestation of market power on sustainability and strategies to tackle negative impacts on sustainability. This work was supported by the Horizon 2020 project SUFISA (grant agreement no 635577).

Environmental economic models often integrate economic parameters such as labour and capital with physical parameters such as energy, emissions or materials. These models show both market behaviour and effects on the environment. A central instrument is the particular production function that relates inputs to outputs. However, the characteristic behaviour of matter and energy is subject to different constraints than the behaviour of labour and capital. Very few economic production functions take that difference into account. This project develops a new economic production function for micro-economic modelling, based on a maximum installed capacity of transformation. Following economic and physical constraints of production functions, an algebraic form is derived. It is tested with a case-study. Secondly the modelling behaviour is compared to a standard function.

Industry is confronted with systemic environmental problems such as limited fossil resources, sustainability concerns of renewable resources, toxicity of end products and waste accumulation. This triggers the pursuit of new processes and business models. New pathways are being developed. For instance, the agro-industrial and chemical sector define pathways including biorefineries, material production from organic waste and sustainable chemistry. The current research investigates policy options in this respect. The interactions within these innovative industrial systems are becoming almost exclusively governed by natural processes. These processes being subjected to nature’s principles, one can see these new installations as a particular extension of the surrounding ecosystem itself, rather than an artificial industrial economic system. This allows the methodology to start from an energy and material balance analysis of the entire ecosystem, including the industrial process. Several authors assess the energy and material efficiency of ecosystems and living organisms in terms of exergy. (Jorgensen and Svirezhev, 2004) Similar methodologies asses the efficiency of industrial processes in terms of exergy or exergy cost. (Szargut, 2005; Valero et al., 1986). Various applications have further developed the method by integrating all major environmental effects in the equation and linking industrial life cycle analysis with the input from ecosystems. (Dewulf et al., 2007). Based on these developments, we propose a methodology to assess the exergy cost of the industrial output starting from the ecosystem it is related to. This is compared to the economic cost and value of the same industrial outputs. Through a life cycle perspective, the methodology compares both natural value and economic value-creation of an innovative industrial process. Built on value assessment and total factor productivity analysis, we delimit the steps to assess these values on an equal basis. The methodology is applied to a case study. The results show the potentials and limitations of such a methodology. For instance, the choice of the ecosystem interacting with the process is of high importance. But also the contribution of ecosystem services requires more research. TUL-Impuls program

Highlights •Biomass resource constraints impact the effectiveness of bioeconomy policies. •Bioeconomy policies may have an important impact on the sector structure in the long run, but the sector growth remains ultimately constrained by the availability of inputs. •Solutions to reduce the biomass constraint have to be included in innovation policy for the biobased economy.

The Belgian pig production has been confronted with stagnating prices since the start of the century. While several studies have investigated the financial structure of the pork production chain, it remains unclear whether excessive market power from slaughterhouses, or meat retailers plays a role. Market power studies can reveal some of the market dynamics in this setting, but this type of research has not yet been applied to the Belgian pork market. This paper looks at potential oligopolies and oligopsonies in the pork production sector. A new model is build to focus on market power dynamics in the market for live pigs. This model distinguishes horizontal and vertical market power parameters both for pig farmers and for slaughterhouses. The results follow from an empirical application using slaughterhouses data for the period 2002-2011. The potential reasons and consequences of these market powers are discussed.

Het aantal structurele files in België was nooit hoger dan in 2015. Deze files zorgen op hun beurt voor een grote economische schade en brengen tal van ecologische gevolgen met zich mee. Een kilometerheffing voor personenwagens wordt meer en meer gezien als een middel om deze congestie en de daarmee gepaard gaande problemen te reduceren. Deze masterproef onderzoek bovendien of een kilometerheffing die geheven zal worden op benzine- en dieselwagens het gebruik van milieuvriendelijke elektrische wagens kan verhogen. Deze invloed wordt onderzocht aan de hand van een partiële evenwichtsanalyse. Uit de resultaten blijkt alvast dat de invoering van een kilometerheffing zal zorgen voor een sterke toename van het aantal elektrische wagens en een bijna evenredige daling van het aantal dieselwagens in België. Deze analyse is wel enkel bedoeld om een eerste indruk te krijgen van de mogelijke marktverschuivingen die zog zouden voordoen bij de invoering van een kilometerheffing. Omdat de uitkomst waarschijnlijk sterk onderhevig is aan de gemaakte assumpties en de gebruikte kosten zal extra onderzoek noodzakelijk zijn om de uitkomsten van dit onderzoek te generaliseren.