Creative destruction or mere niche support? Innovation policy mixes for sustainability transitions

Abstract

Recently, there has been an increasing interest in policy mixes in innovation studies. While it has long been acknowledged that the stimulation of innovation and technological change involves different types of policy instruments, how such instruments form policy mixes has only recently become of interest. We argue that an area in which policy mixes are particularly important is the field of sustainability transitions. Transitions imply not only the development of disruptive innovations but also of policies aiming for wider change in socio-technical systems. We propose that ideally policy mixes for transitions include elements of ‘creative destruction’, involving both policies aiming for the ‘creation’ of new and for ‘destabilising’ the old. We develop a novel analytical framework including the two policy mix dimensions (‘creation’ and ‘destruction’) by broadening the technological innovation system functions approach, and specifically by expanding the concept of ‘motors of innovation’ to ‘motors of creative destruction’. We test this framework by analysing ‘low energy’ policy mixes in Finland and the UK. We find that both countries have diverse policy mixes to support energy efficiency and reduce energy demand with instruments to cover all functions on the creation side. Despite the demonstrated need for such policies, unsurprisingly, destabilising functions are addressed by fewer policies, but there are empirical examples of such policies in both countries. The concept of ‘motors of creative destruction’ is introduced to expand innovation and technology policy debates to go beyond policy mixes consisting of technology push and demand pull instruments, and to consider a wider range of policy instruments combined in a suitable mix which may contribute to sustainability transitions.