Natural Blends, Sustainable Innovations and Income Growth

Abstract

The paper discusses innovations for both income growth and the generation of better environmental qualities. This is possible in theory but progress in practices is slow. We argue that social pressures to contain pollution were effective insofar they invoked environmental policies all over the world, which enabled to reduce pollution in some countries at decreasing costs. This is achieved in the past five decades despite fierce resistance of vested interests in industries and policymaking. Economies are still extremely wasteful but there is progress in many countries toward ecoefficiency, which is illustrated for the European Union. In the future, a growing demand for sustainability is expected. This demand is not primarily because of costly natural resource in consumption, they decrease in real prices, but due to the changes in social structures towards more knowledge work and growing leisure time. The knowledge work and leisure time require more personal interactions even though the labour costs increase and more environmental qualities through cleaner production and consumption. These demands invoke innovations that blend environmental qualities with artefacts. Such natural blends are highly demanded and the qualified blends are highly paid. Sustainable innovations through blending of natural and cultural attributes are in progress. Innovators become a driving force for sustainability and the innovative networks key elements for the resulting outcomes. These networks entail distributed business models. Environmental qualities constitute highly demanded values. The challenge is to translate this social sense of urgency into new policies and market arrangements in support of innovators for sustainable development