An Institutional Entrepreneurship Analysis of Biodiesel Companies in Mexico

An Institutional Entrepreneurship Analysis of Biodiesel Companies in Mexico

José G. Vargas-Hernández (University of Guadalajara, Mexico), Juan José Esparza-López (Universidad de Guadalajara, Mexico) and Adam Konto Kyari (Imam Abdulrahman Bin Faisal University, Saudi Arabia)
DOI: 10.4018/978-1-5225-7625-9.ch013

Abstract

The objective of this chapter is to analyze the role of the institutions in the biodiesel industry in order to know if there is a relationship with the quality and maturity of the same with the ventures. Starting from a literary review, the framework of the current situation is identified, covering aspects related to formal institutions, laws, rules, regulatory bodies, and the theory that supports the relationship between institutions and entrepreneurship. The chapter concludes that the institutions in Mexico have increased their maturity and incentive to increase the number of producers and distributors of biodiesel, thus taking advantage of the growing market.
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Background Of The Problem

To solve the twin problems of cleaner fuel and cleaner urban environment, the Mexican government promotes the production, distribution and consumption of biofuels in several plants. Included among the varieties of the biodiesel are those that promote the use of clean and renewable energies as alternatives to fossil fuels, consistent with the global emphasis on climate change.

Biodiesel is a mixture of monoalkyl esters of fatty acids that is obtained through processes such as the “transesterification” of industrial waste oils and fats. As a mixture of methyl esters of fatty acids, biodiesel t can replace diesel and is obtained from the reaction of vegetable oils or fats with methanol. Glycerin is obtained as a byproduct. Biodiesel is used mainly in Europe and the USA in mixtures with 5% or 20% diesel (B5, B20) or as pure biodiesel (B100). In Brazil and Argentina B5 is used.

In Mexico, the Prospective for the use of bioenergy was designed in 2003. The prospective highlights that the infrastructure used by Pemex to produce diesel can be used, considering that diesel engines would require minor adjustments to use pure biodiesel. In addition, it is considered that there has been an increase in the cultivation of oil producing plants in tropical and temperate climates and that there are fiscal incentives and subsidies to promote biodiesel. In 2007, the first study on the possibilities of bioethanol and biodiesel as transportation fuels in Mexico was conducted (SENER / BID / GTZ (Edit.), 2007).

Key Terms in this Chapter

Company: A company is an enterprise or business that has been organized as a business and commercial society including capital and labor and whose main purpose is to obtain an economic benefit.

Formal Institutions: Are the institutions related to constitutions, codes, laws, contracts, and other legal elements.

Informal Institutions: Are extensions, interpretations, and modifications of formal rules, rules of behavior, agreements, codes of conduct, or conventions and all those aspects that are related to culture.

Biodiesel: Biodiesel is a liquid biofuel that is obtained from lipids of natural origin, such is the case of vegetable oils or animal fats that have had or not previous use, subjected to the transesterification process.

Entrepreneurship: It is the ability of people to create new businesses. It is the person who knows how to discover, identify a specific business opportunity and then will arrange or get the necessary resources to start it and then take it to fruition.

Mexico: A country located in North America.

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