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The influence of eco-innovation on high-performing firms: The dynamics of productivity in the context of circular economy

Year: 2025

Type: article

Abstract: This paper analyses the influence of eco-innovation on the dynamics of firm performance in the context of a circular economy. From a firm-level approach, we investigate whether firms whose innovation strategies simultaneously aim at significant reductions in material and energy consumption and high environmental awareness (circular eco-innovators) have a higher probability of both reaching (entry) and remaining (persistence) in the group of high-performing firms (top of high-productivity firms). The sample data are from a panel of Spanish manufacturing firms for the period 2003–2016. To deal with endogeneity problems, a two-step methodology is used combining survival models and matching techniques. The results show higher firm productivity for circular eco-innovators at entry and persistence in the upper part of the productivity distribution. The study concludes that circular eco-innovations effectively promote more persistent and resilient performance in Spanish manufacturing firms.

Source: European Research on Management and Business Economics

DOI: 10.1016/j.iedeen.2025.100275

Authors: David Córcoles, Ángela Triguero

Institution: University of Castilla-La Mancha

Language: English

Topic: Environmental Sustainability in Business

Subfield: Marketing

Field: Business, Management and Accounting

Domain: Social Sciences

SDGs: Industry, innovation and infrastructure, Responsible consumption and production, Decent work and economic growth

Open Access status: gold

Estimated APC paid: $1,350