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

Chapter 3
Analytical framework
3.1 Introduction
This chapter introduces the analytical framework that will guide the
following empirical chapters. The focus is on the way systems and their
dynamics can be studied. Central to this book is the hypothesis that
transformation of systems of production and consumption involves a multilevel
process of co-evolution of institutional and technological change. At
the micro level it involves the development of a novel or alternative practice,
such as a new product, technology or concept, made possible as a variety of
actors, such as firms, policy-makers, customers, change their way of doing
things. At the meso-level it involves changes in practices at the level of
sectors, such as the formation of industrial, technological and management
standards, and new forms of exchange and interaction between a variety of
actors, and at the macro-level it involves changes in systems of innovation,
regulation and the way the system is embedded in society. Systems change
slowly occurs as changes at different levels start to connect and synchronise,
leading to the emergence of new institutional fabric that solidifies linkages
between the different levels.
The aim of this book is to test and further specify this general hypothesis by
analysing patterns of change in the electricity system. Scientifically, the
relevance of the book is in its analysis and explanation of fundamental
processes of change, a topic relevant for a range of scientific disciplines,
from economics, sociology, technology studies, to policy science. Its societal
relevance lies mainly in its use for gaining insight in the way systems change
can be directed towards the normative goal of sustainable development.
The chapter introduces an institutional perspective on systems change which
will be applied in the empirical chapters. The next section introduces this
perspective, the way it is operationalised through key elements of
sociotechnical systems, and the way these systems are embedded in broader
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