Abstract
Ongoing environmental innovation is the only way to reduce pressures on environmental qualities while maintaining income growth. However, the views on how to initiate and foster environmental innovations differ. In the essay we discuss three theoretical approaches. From neo-classical economic theory we distill the message that research and development of new technology thrive on economic incentives. The evolutionary theory describes patterns in technological development but in our view it exaggerates the importance of technological interlinkages that cause lock-in, as barriers to environmental innovation and it overlooks the organisational impediments within the firm. From the behavioural theory of the firm we learn that innovations can only get through in situations of urgency. The conclusion is that a strict environmental policy can create the sense of urgency and strong incentives for environmental innovation. Ambitious and inflexible targets at macro-level but flexibility at micro-level of the firm are unsurpassable as a policy to foster environmental innovation.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
