Analyzing the impact of biofuel industry on Thailand’s economy based on input-output model

Abstract

This research tries to examine the impact of the biofuel industry focusing on ethanol and biodiesel on Thailand's economy. It uses input-output analysis. In the past 10 years, Thailand's Alternate Energy Development Plan (AEDP) has played a significant role in launching policies and promoting the biofuel industry. The plan focuses on increasing internal energy security by increasing the use of alternate sources of energy which is a perfect replacement for the importation of fuels. However, the main challenge is price competitiveness which requires subsidization to sustain its market in the industry. Therefore, the main objective of this study is to focus on the impacts of biofuels on every sector and the total output of the Thailand economy. The biofuel industry can increase the household income and the total output of the Thailand economy. However, the government might slightly loose on value-added tax but that benefit is channeled to household income. This calls for collective efforts in promoting the biofuel industry.