Governing Innovation for Sustainable Development: Designing creative institutions

Abstract

The aim of this working paper is to advance the discussion on how social systems for sustainable innovation should be designed. Particularly, we discuss implications of the new Sussex Manifesto, which argues that innovations should be more directed at the needs of poor and excluded groups in society and, consequently, that innovation processes should include these groups. Based on Polanyi's work, we argue states and markets should work closely together to avoid socially detrimental effects of economic development. We focus specifically on the construction of socially embedded innovation systems that pursue the ‘triple bottom line’ of sustainable development: social benefits, economic benefits, and benefits to the natural environment. By including social and distributional issues, we look beyond ideas about ‘green growth’ that typically focus only on the ‘double bottom line’ of economic and environmental benefits.