Chapter 9: Policy Instruments for Promoting Green Innovation in Economic Development: The Case of Georgia

Introduction: Economic growth plays a crucial role in fostering good governance and democratic stability by redistributing public goods, creating jobs and promoting the middle class. It also helps reduce corrupt practices and supports the enforcement of universal norms, which are essential for building more inclusive institutions. However, there are limits to growth and global economic development that may have detrimental effects on the environment if world economies do not design policy instruments to mitigate these harmful effects (Meadows et al., 1972). Developing a combination of policy instruments can encourage eco-friendly economic behaviours and practices.

Purpose: This study aims to examine various policy instruments that contribute to sustainable development and green innovation. Our goal is to provide a comprehensive analysis of policy strategies, environmental regulations and subsidising funding mechanisms that support green innovations. Additionally, we seek to raise awareness and transfer knowledge about the importance of environmental protection, while fostering cooperative networks among key stakeholders to develop innovative solutions and implement carbon pricing.

Methodology: The study employs qualitative methodology to offer a comprehensive analysis of green policy strategies and to explain how they foster green innovation, while supporting economic development in the case study of Georgia.

Findings: The results of this analysis indicate that Georgia still lacks effective policies and strategies related to eco-innovation and that the existing green subsidies are inadequate. Key stakeholders within the policy framework do not have clearly defined roles, and additional measures are necessary to raise awareness about the importance of collaboration in sharing expertise and engaging societal actors.