Assessing the relationship between economic and ecological performance: Distinguishing system levels and the role of innovation

In this article we critically discuss the different perspectives that are currently in use for assessing the relationship between ecological and economic performance. Based on a review of the literature we propose that research up till now has made use of four distinct system boundaries: the firm, markets, production and consumption systems, and economic systems. Making these boundaries explicit is helpful in interpreting the mixed results that have been obtained. We describe the consequences of the choice for each of these system boundaries: and look at implications for innovation. We also argue that the production and consumption system boundary offers potential for further advances in the field and deserves more attention in future research.