Innovation and institutional change: the transition to a sustainable ...

Theoretical perspectives 31
cohesive and closed, or more open and differentiated (the tighter and more
cohesive, the less vulnerable). Last, we may imagine institutional
arrangements that impose high switching costs on incumbent regimes and
that promote good connectivity within it, or alternatively a set of
arrangements that tend to reduce switching costs (perhaps by giving
incentives for switching) or promote better connectivity within competing
regimes. Again the former arrangement would tend to favour an incumbent
regime. In practice it is likely that different regimes will exhibit different sets
of characteristics at different points in time, dynamically reshaping the
profile of their robustness or vulnerability”. For a regime change to unfold,
they argue that “it must be recognised as necessary, feasible and
advantageous by a broader range of actors and institutions than would
normally be the case for a discrete technological change”.
If we sum up this overview we can discern between factors exogenous to the
regime (external shocks and scientific results), either exogenous or
endogenous (technological breakthroughs which can occur either from inside
or outside the regime; new organisational forms, institutional changes), and
endogenous (misadaptations, tensions within the regime, changes in
preferences and niche markets (although probably exogenous factors play a
role in explaining, e.g. environmental concerns, ICT penetration), and nonaverage
actors. We basically adhere to the formulation of Unruh (2002) that
for a process of transition such as escaping carbon lock-in several
interconnected changes will have to take place, both initiated from within
and outside the regimes, and consisting of combinations of institutional,
organisational and technological changes. Although maybe this is not much
of a help, it on the other hand makes clear that there may be a range of
developments available to which new innovations may hook on to. Moreover
those innovations that emerge at the intersection of different regimes may
gain strength by exploiting combinations of tensions in different regimes.
This bears some similarity with remarks made on cluster development by
Porter (1998: 241) that “cluster development often becomes particularly
vibrant at the intersection of clusters. Here, insights, skills, and technologies
from different fields merge, sparking new businesses. The presence of
multiple intersecting clusters further lowers barriers to entry, because
potential entrants and spin-offs come from several directions. Diversity of
learning stimulates innovation”.
2.3.2 The nature of institutions, institutional change and its
contribution to systems change
The importance attributed in this thesis to the role of institutions and
institutional change in systems change demands a more careful consideration