Browsing by Author "Friman, Aino"

This thesis analyses the economic effects of food loss and food waste reduction in South Ostrobothnia. The aim is to examine the economic effects when the food industry and food services are forced to reduce their existing food loss and food waste. The theoretical framework of the thesis is based on the General Equilibrium theory. The analysis is performed by using the Computable General Equilibrium (CGE) model. The analysis includes three simulations; the first targeted solely on the food industry and the second solely on food services. The third simulation includes both the food industry and food services. In all simulations, the targeted activities are forced to halve their existing food loss or food waste by reducing the use of agricultural commodities and food products as intermediate inputs. In the first simulation, the results regarding food industry food loss reduction reveal the importance of the food industry to the economy of South Ostrobothnia. The results suggest that food industry food loss reduction would be very beneficial, especially for the industry itself. The food industry would now become more competitive and be able to produce more with fewer cost. This would also decrease the prices of food products. Agriculture would also benefit from food industry food loss reduction, as the demand for agricultural commodities would increase. As the CGE model deals with all markets simultaneously, food industry food loss reduction would have an effect on other activities in the region. For the metal industry, for example, the effect would be negative. The overall GDP effect would, nevertheless, be positive. The simulation targeted on food service would yield more modest effects on specific activities, but the economic effect in terms of GDP would be positive and more significant than in the first simulation. For agriculture and the food industry the effect would be negative. This is because food services represent the end users, and their decrease of food waste reduction would result in a lower demand for agricultural commodities and food products. The results of the combined requirement for the food industry and food services to reduce their existing food loss and waste simultaneously introduces a balance between the results of the first two simulations. The results indicate that reduction efforts targeted on both the food industry and food services would yield the largest gains. In the third simulation, the economic effect would be positive in terms of employment, household income and GDP, for example. From a policy point of view, the results suggest that it would be important to target policy measures at all agents of the food chain. In this regard, suitable policy measures should include policy targets to avoid food losses and food waste as such and also targets to find ways to utilize the already existing food waste and losses. For possible future research, further attention would be required to examine the economic effects of food loss and food waste reduction, in particular, at regional level.