Schumpeterian economic dynamics of greening: propagation of green eco-platforms

The greening of business is now widely recognized as firms take the lead from reluctant governments in making sustainable operations profitable. The greening of business may be contrasted with the “business of greening” – in the sense that greening may be associated with the emergence of smart green platforms that propagate and expand as they creatively destroy industries that are rooted in a fossil fuelled past. Such considerations bring into focus the evolutionary economic dynamics of greening, involving business concepts like emergence of platforms and networks, the capture of increasing returns, the role of manufacturing, mass production and learning curves, which help to account for green innovation and green growth as drivers of the global green shift. This is a perspective that is distinguished from “zero growth” and “natural capitalism” approaches to greening; and it is one that is as applicable as much to China and emerging industrial powers as to advanced industrial countries. Fundamentally, greening is characterized as the emergence of green business platforms which create new possibilities for green growth as they propagate, driven by supply-side dynamics as much as by demand-side dynamics involving changed consumer behavior, as in the rise of the sharing economy. Fundamentally it is cost reduction (via learning curves) and capture of increasing returns that open up opportunities for new business strategies that creatively destroy the old business models associated with fossil fuels and resource wastage.