A market boundary is the spatial and temporal delimitation of a market, within which the price of a product is uniformly determined. It defines the geographical area and time period over which a specific product trades in a single market with uniform pricing.
The spatial component of a market boundary defines the geographical extent within which products are traded under similar market conditions. This may correspond to local, regional, national, or international markets, depending on factors such as transport costs, trade barriers, regulatory frameworks, and the nature of the product itself. For products with high transport costs relative to their value, market boundaries tend to be smaller and more localised. Conversely, products with low transport costs or high value density may have market boundaries that span continents or even global markets.
The temporal component establishes the time period over which market conditions remain relatively stable. This recognises that markets evolve over time due to technological changes, shifts in supply and demand, and regulatory developments. In Life Cycle Assessment, defining appropriate temporal boundaries ensures that market data accurately reflects the conditions relevant to the assessment period.
Understanding market boundaries is important for consequential Life Cycle Assessment modelling, where identifying which markets are affected by changes in demand, and which suppliers within those markets respond to changes, directly influences the assessment results. This helps determine which activities should be included in the product system and which Market activities appropriately represent the supply structure within that boundary.
As Chief Operating Officer, Iris leads our organisational development and oversees day-to-day operations. Before joining 2-0, she worked in the biotechnology sector. As an LCA consultant, Iris has devoted her expertise primarily to the domains of sustainable agriculture and food production. She is dedicated to teaching LCA and is responsible for our educational efforts. Iris holds an M.Sc. in Biology – Biotechnology from the University of Copenhagen.
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Glossary terms are clearer once you have seen them applied. Our guide to what LCA is and how it works walks through the complete methodology: goal and scope, inventory modelling, impact assessment, and interpretation.
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