Green growth, technology and innovation

The paper explores existing patterns of
green innovation and presents an overview of green
innovation policies for developing countries. The key
findings from the empirical analysis are: (1) frontier green
innovations are concentrated in high-income countries, few
in developing countries but growing; (2) the most
technologically-sophisticated developing countries are
emerging as significant innovators but limited to a few
technology fields; (3) there is very little South-South
collaboration; (4) there is potential for expanding green
production and trade; and (5) there has been little
base-of-pyramid green innovation to meet the needs of poor
consumers, and it is too early to draw conclusions about its
scalability. To promote green innovation, technology and
environmental policies work best in tandem, focusing on
three complementary areas: (1) to promote frontier
innovation, it is advisable to limit local technology-push
support to countries with sufficient technological
capabilities -- but there is also a need to provide global
technology-push support for base-of-pyramid and neglected
technologies including through a pool of long-term, stable
funds supported by demand-pull mechanisms such as prizes;
(2) to promote catch-up innovation, it is essential both to
facilitate technology access and to stimulate technology
absorption by firms -- with critical roles played by
international trade and foreign direct investment, with firm
demand spurred by public procurement, regulations and
standards; and (3) to develop absorptive capacity, there is
a need to strengthen skills and to improve the prevailing
business environment for innovation -- to foster increased
experimentation, global learning, and talent attraction and
retention. There is still considerable progress to be made
in ranking green innovation policies as most appropriate for
different developing country contexts -- based on more
impact evaluation studies of innovation policies targeted at
green technologies.