How to Make Eco-innovation a Competitive Strategy: A Perspective on the Knowledge-Based Development

Abstract

Eco-innovation is currently a fuzzy concept in need of theoretical clarification. It is difficult to define because of the complexity of the subject. Nevertheless, eco-innovation can be described as innovation that consists of new or modified products, processes, practices, systems and business methods which aims to prevent or reduce environmental risks and can contribute to environmental sustainability. In this sense, the term eco-innovation has called attention to the positive contribution that industry can make to sustainable development and a competitive economy. Hence, eco-innovation is understood as the combined improvement of economic and environmental performance of society. If eco-innovation is considered a dynamic of our society, economic growth, social development and environmental integrity are essential ingredients of sustainability. Performance is the result of complex socio-economic process and has different dimensions (environmental and economic) and levels (micro and macro). A systematic analysis of eco-innovation dynamic should consider – at micro level – social processes between knowledge, institutions and firms and look for causal links among them. At the macro level, it is necessary to understand environmental, economic and social dimensions in which eco-innovation strategies may develop. The new economy is not only a knowledge economy but also an economy based on responsible behaviour. In the knowledge-based development (KBD), the key to growth and prosperity relies on the issues of acquiring, creating, developing, storing and applying knowledge for a sustainable economic, social and environmental development. A knowledge-based perspective may provide a holistic approach on wealth creation where eco-innovation is seen as a concept which provides direction and vision for pursuing the overall societal changes needed to achieve sustainable development. This chapter aims to explore the foundations of KBD and propose a framework to integrate the two key issues, eco-innovation and KBD.