Keywords: biotechnology industry, economic forecasts, growth contribution, input–output model, Monte Carlo simulation, Finland, economic growth
Projected growth effects of the biotechnology industry in Finland: the fourth pillar of the economy?
This study assesses the impact of the Finnish biotechnology industry on economic growth in Finland. The study employs official data from Statistics Finland and new survey data covering 84 Finnish biotechnology companies. An econometric forecast for the economy-wide growth impact of the biotechnology industry in Finland is presented. In the estimation procedure, this study employs the survey data both in forming growth anticipations within a new emerging industry and assessing inter-industrial growth effects. Applied Monte Carlo simulations predict that the contribution of the biotechnology industry to annual GDP growth in 2002–2006 will be in the range of 0.05–0.09 percentage points per annum with a probability of 90%. These results imply that it will take decades rather than years for the biotechnology industry to become a fourth pillar of the Finnish economy beside the forest industry, the metal products and machinery industry, and the electronics industry.