Redefining innovation - eco-innovation research and the contribution from ecological economics

While innovation processes toward sustainable development (eco-innovations) have received increasing attention during the past years, theoretical and methodological approaches to analyze these processes are poorly developed. Against this background, the term eco-innovation is introduced in this pape r addressing explicitly three kinds of changes towards sustainable developm ent: technological, social and institutional innovation. Secondly, the pote ntial contribution of neoclassical and (co-)evolutionary approaches from en vironmental and innovation economics to eco-innovation research is discusse d. Three peculiarities of eco-innovation are identified: the double externa lity problem, the regulatory push/pull effect and the increasing importance of social and institutional innovation. While the first two are widely ign ored in innovation economics, the third is at the least not elaborated appr opriately. The consideration of these peculiarities may help to overcome ma rket failure by establishing a specific eco-innovation policy and to avoid a 'technology bias' through a broader understanding of innovation. Finally, perspectives for a specific contribution of ecological economics to eco-in novation research are drawn. It is argued that methodological pluralism as established in ecological economics would be very beneficial for eco-innova tion research. A theoretical framework integrating elements from both neocl assical and evolutionary approaches should be pursued in order to consider the complexity of factors influencing innovation decisions as well as the s pecific role of regulatory instruments. And the experience gathered in ecol ogical economics integrating ecological, social and economic aspects of sus tainable development is highly useful for opening up innovation research to social and institutional changes. (C) 2000 Elsevier Science B.V. All right s reserved.