Environmental innovation and industrial dynamics: the contributions of evolutionary economics

The purpose of this article is to discuss the contributions of the evolutionary theory of innovation on the micro and meso dynamics of environmental innovations. We argue that the evolutionary literature on innovation, and more particularly on technological regimes, provides a relevant framework in order to analyse the various determinants of environmental innovations and the double externality problem in an industrial dynamics context. The article starts with an overview of the empirical literature on environmental innovations with a focus on their determinants and specificities. In section 3, we discuss the contributions of the evolutionary literature on technological regimes and argue that it can provide a relevant framework for a sectoral approach of environmental innovations. In section 4, we concentrate on the role of demand side dynamics and highlight the implications of technological competition models on the role of demand conditions in the diffusion of environmental technologies. Finally, section 5 is devoted to the implications of the evolutionary theory of innovation on the question of the transition towards more sustainable technological systems.