Complementarities, Firm strategy and Environmental Innovations: Empirical evidence for a local manufacturing system

Innovation is a key factor in firms achieving better environmental performance, to the extent that it helps to increase the materials/energy efficiency of production processes and reduces the emissions/effluents associated with outputs. The study has two main aims. First, by testing a set of hypotheses, to provide new evidence on the influence of a wide array of innovation drivers. Second, to examine the hypothesis of a complementary relationship regarding the adoption of different environmental innovations and a set of associated innovation drivers. The investigation shows that the more general structural characteristics of the firm appear to matter less than eco auditing, R&D and policy related costs. As far as adoption of different eco innovations is concerned, the analysis shows that firms that innovate tend to pursue different environmental innovations simultaneously. At the level of innovation drivers, it appears that the complementarity, though predominant across the various pairings of drivers, presents an evidence, which is dependent on the typology of innovation and the specific analysed innovation drivers Thus, though relevant for explaining innovation dynamics, and crucial in terms of informing management and policy efforts, complementarity is not the complete panacea to the complexity of the environmental innovation system, from either the management or the policy action point of view.