Frugal Entrepreneurship: Innovation for social inclusion

Abstract

Developing something from scratch through entrepreneurial DIY is a growing phenomenon in emerging markets (Baker and Nelson, 2005). Recent years have seen a surge in affordable product development targeting new markets (Ravishankar and Gurca, 2015). Entrepreneurs in resource-scarce environments often develop such products (Hossain, 2017; Simula et al., 2015). As Baker and Nelson (2005) suggest, companies practice bricolage to overcome the limitations imposed by a resource-poor environment. In an age of austerity and crises - such as the Covid 19 crisis - resource constraints force entrepreneurs to develop affordable, high-quality offerings. Contemporary literature has brought some recognition to this category of entrepreneurs (George, McGahan, and Prabhu 2012; Hall et al. 2012; Ramani and Mukherjee 2014). Yet how these entrepreneurs innovate and overcome the resource scarcity that characterizes BOP remains largely unexplored. Frugal entrepreneurs behave in an atypical way, in a way that differs from the behaviours referenced in relation to causal and factual rationality.

In the present literature review, we aim to approach three main points essential to the analysis of frugal innovations (FI): First, how grassroots entrepreneurs conceptualize, develop and disseminate their frugal innovations. Second, to review the literature on FIs from the perspective of frugal entrepreneurship and social inclusion.

Keywords : Frugal entrepreneurship - Emerging market - Frugal innovation - Inclusive innovation - Entrepreneur bricoleur.

JEL Classification : L26

Paper type : Theoretical Research