Assessment of the social capabilities for catching-up through sustainability innovations

We compare newly industrialising countries as to their capabilities for integrating sustainability innovations into their catching-up processes. We thereby provide an approach to assess their absorption potential for sustainability innovations. The conditions that favour the exploitation of imitation opportunities are separated into general innovation capabilities and the sustainability selection environment. Using principal component analysis to aggregate numerous subjective indicators, we construct two composite indices that measure the functioning of the national innovation system and the societal anchoring of sustainability, respectively. Both indices have a strong positive correlation, suggesting that the development of certain institutions promotes both innovation and sustainability.