The Differentiated Impact of the Institutional Environment on Eco-Innovation and Green Manufacturing Strategies: A Comparative Analysis Between Emerging and Developed Countries

Abstract

This article argues that institutional environments have different impacts on the association between a strategic orientation to eco-innovation and green manufacturing (GM), depending on the countries’ degree of development and type of market. A survey drew 172 responses from manufacturing firms from emerging countries (Brazil and India) and 130 responses from developed countries (Germany and the USA). The results showed that institutional regulatory pressures impact firms in emerging markets at a strategic level, putting pressure on an orientation aimed at eco-innovation. In contrast, consumer market pressures have an effect on developed markets at the execution level, directly impacting GM activities. The main contribution of this article demonstrates that different institutional environments consist of induction factors applied to the competitive strategy of innovation management (strategic orientation for eco-innovation) and engineering (GM). Our results reveal that institutional impulses generated by the dimensions of consumer pressure or by a market's regulatory framework may differ. In this sense, the patterns of institutional maturity and environmental maturity of the markets are equally important in inducing the development of eco-innovative and GM capabilities. The evidence provides insights for managers in both developed and emerging markets about the drivers of institutional environments in different contexts and about how management strategies aimed at eco-innovation and GM should be guided.