Towards a strategic framework for promoting environmental innovations

Abstract

Studies have shown that markets for environmental innovations are highly dependent on government intervention, and, with few exceptions, markets for environmental technologies have been “policy driven”. Moreover, there is widespread consensus that no individual policy instrument but rather a “smart policy mix” is needed to effectively drive the development and diffusion of environmental innovation. However, what exactly represents such a smart policy mix remains largely undefined. This paper takes this discussion a step further by developing what is called a “strategic framework” for promoting environmental innovation. Drawing on strategy concepts from the management sciences, this analytical framework provides the basis for systematizing and integrating lessons from existing evolutionary approaches to promoting environmental innovation. While individually none of these approaches provides a sufficient basis for developing a truly comprehensive policy mix, they each help to elaborate a particular element of the proposed strategic framework. Combining them in this way, therefore, represents an important step forward for developing adequate policies for the promotion of environmental innovation. Furthermore, the strategic framework not only provides a more comprehensive but also a more dynamic approach to the design of smart policies for promoting environmental innovation.