Policies for climate change have never received as much attention worldwide as now. At the same time another key policy trend is an increasing synthesis between environmental and innovation policy, a synthesis, it is here suggested, that is captured by the “eco-innovation” concept. This paper suggests that the innovation system frame based on evolutionary economic theory may guide the development of these new eco-innovation policies in important ways. The paper seeks to uncover the theoretical underpinnings and new rationales associated with these policies.
The paper argues that the eco-innovation approach represents a shift in rationale from the traditional regulatory approach within environmental research and policy making towards an evolutionary market based approach to achieve climate and wider sustainability goals; not only in putting more emphasis on the market but also shifting the representation of the economy towards a more dynamic one. Rather than pursuing immediate environmental goals in climate policy making the paper suggests a long run policy for wiring up the national innovation system for ecoinnovation.
This paper has claimed that a innovation systems perspective represents a potential new evolutionary environmental policy rationale in fundamentally viewing the economy as a long run process subjected to path- and time dependencies. The new rational is particularly clear in two ways:
1) In treating the company as (eco-)innovator rather than as polluter
2) In adapting a strong knowledge approach.
The innovation system policy approach strives to mould the innovation system so as to make it easy and attractive to engage in eco-innovation for firms as well as knowledge institutions (and to lesser degree consumers). The five pillar strategy suggested reduces the friction to eco-innovation. There is however, a need to identify, through innovation system empirical analysis, the specific charactheristic and 2 innovation conditions as well as system failures to eco-innovation in the given innovation system.
The innovation system frame is only beginning to be caught up in environmental analysis and mainly from the so-called “functional “ perspective; this paper suggests that the “organisational” approach is more needed. Overall, we need to link up micro-oriented innovation policy with the macro-oriented climate policy so as to align short run targets with the long run target of wiring up national innovation systems for eco-innovation.