When do institutional actors drive green innovation adoption vs. generation? Evidence from tax, customer, and network pressures

Abstract

The prevailing approach in green innovation research merges adoption and generation into a single measurement, and while traditional innovation studies indicate that these modes can have dissimilar antecedents, this distinction remains unexplored for green innovation. Addressing this gap, this study draws on institutional theory to examine which specific institutional actors: state authorities (environmental tax), corporate customers, and contact networks, are universal in driving both adoption and generation of green innovation, and which are mode-specific. Analyzing a sample of 1,116 Russian small- and medium-sized enterprises (SMEs) using logistic regression, we separately model green innovation adoption and generation as functions of tax, customer pressure, and network membership. We find that environmental tax is positively associated with both adoption and generation of green innovation, while pressure from corporate customers only stimulates adoption, not generation. Notably, contact networks have a positive effect on adoption but a negative effect on generation. By explicitly distinguishing between these two innovation modes, the study clarifies contradictory findings in green innovation literature and offers a more robust methodological approach to the use of institutional theory in green innovation research. For policymakers in emerging and developing economies, the results imply that different institutional actors require tailored interventions: taxes can drive both diffusion and novelty, customer pressure is suitable for spreading existing practices, and networks should be redesigned to avoid discouraging in-house innovation while still promoting adoption.