Value-Chain Configuration and Innovation Dynamics in Traditional Bioeconomy Sectors: Evidence from the Sugar Industry

This study investigates the influence of value-chain configuration on innovation dynamics within traditional bioeconomy sectors, with specific evidence drawn from the sugar industry in Pakistan. A quantitative research design was employed using questionnaire data collected from 197 respondents, including producers, processors, managers, technical experts, and knowledge intermediaries operating across the Pakistani sugar-industry value chain. The analysis was conducted using Jamovi and SPSS software through descriptive statistics, exploratory factor analysis, reliability analysis, correlation analysis, regression analysis, mediation analysis, and moderation analysis. The findings reveal that value-chain configuration exerts a significant positive influence on innovation dynamics by strengthening coordination mechanisms, facilitating knowledge-sharing practices, and enhancing organisational learning capabilities. The study further demonstrates that absorptive capacity and collaboration-oriented knowledge requirements partially mediate the relationship between value-chain configuration and innovation dynamics. The results indicate that innovation within traditional bioeconomy sectors remains predominantly incremental, efficiency-oriented, and interaction-driven rather than strongly technology-driven. In addition, competition and cost pressures were found to negatively moderate the relationship between value-chain configuration and innovation dynamics, explaining that excessive market pressure can weaken the innovation benefits associated with coordinated governance structures. These findings highlight the importance of collaborative governance frameworks, institutional support mechanisms, and inter-organisational learning processes in promoting sustainability-oriented innovation within traditional bioeconomy industries in Pakistan. The study offers valuable implications for policymakers and industry stakeholders seeking to strengthen innovation performance through improved coordination, knowledge integration, and strategic value-chain governance.