The Effect of Open Innovation on Eco-Innovation Performance: The Role of Market Knowledge Sources

Abstract

Organizations use multiple strategies to increase the number and impact of eco-innovations as a path to achieve competitive advantage. In this article, we study the role of open innovation activities, specifically related to market sources, as a driver of eco-innovation performance. While studies have looked at the relationship between these two emergent innovation phenomena from a broad perspective, we explore whether specific market knowledge sources—clients, suppliers, competitors, and consultants—and their combined use—affect eco-innovation performance. We rely on insights from theories of open innovation and sustainable and environmental innovation to build a theoretical framework about the determinants of eco-innovation performance from a market-driven open innovation perspective. Our sample consists of 3047 firm-year observations obtained from three consecutive panels of the Chilean Innovation Survey (2009–2014). We found that clients, suppliers, competitors, and consultants as knowledge sources positively influence eco-innovation performance in firms. In addition, our results suggest that a combination of client sourcing with supplier and consultant sources of knowledge positively affect eco-innovation performance. We discuss the implications of our findings for open innovation activities on eco-innovation and suggest ideas for future research.