Environmental innovation: a concise review of the literature

The importance of environmental innovation or “eco-innovation” has become well recognized in the innovation literature. The present survey proposes a review of the most prominent contributions in the field. The review of the theoretical works suggests that the definition of eco-innovation is still evolving, although recent definitions all tend to be based on environmental performance rather than on environmental aim. The review of the empirical research indicates that, besides conventional technology-pushed and demand-pulled factors, environmental policy has a strong impact on eco-innovation. This is mostly a result of eco-innovation sharing some of the characteristics of a public good. We also consider some issues that remain to be explored, such as the diffusion of eco-innovation. If it is as beneficial as expected, a better grasp of its adoption mechanisms is still required.