Rosca, Reedy, Bendul - 2018 - Does Frugal Innovation Enable Sustainable Development A Systematic Literature Review

Special Issue Article
Does Frugal Innovation Enable Sustainable Development?

A Systematic Literature Review
Eugenia Roscaa,*, Jack Reedya and Julia C. Bendula
a
School of Mathematics and Logistics, Jacobs University Bremen gGmbH, College Ring 1,
28759 Bremen, Germany.
E-mail: j.reedy@jacobs-university.de
E-mail: j.bendul@jacobs-university.de
*E-mail: e.rosca@jacobs-university.de
Abstract The Sustainable Development Goals set by the United Nations recognize and promote inter-
and intra-dependencies between the economic, social and ecological dimensions, emphasize the inclusion
of local communities in the development processes and the need for sustainable consumption and pro-
duction. To achieve these goals, interdisciplinary and collaborative efforts are needed. Frugal innovation
emerges as a paradigm challenging traditional innovation pathways which may have the potential to bring
together different stakeholders’ efforts to achieve sustainable development goals. This systematic litera-
ture review analyzes current research linking the concepts of frugal innovation and sustainable devel-
opment. The aim is to highlight approaches and conditions in which frugal innovations can drive
sustainable development, especially in relation to different types of private sector actors. Based on the
content analysis of current studies, we formulate shortcomings of existing research and develop a research
agenda with the aim to bring the two research streams closer.
Les Objectifs de Développement Durable fixés par les Nations Unies reconnaissent et promeuvent les inter
et intra dépendances entre les dimensions économiques, sociales et écologiques, soulignent l’inclusion des
communautés locales dans les processus de développement et la nécessité d’une consommation et d’une
production durables. Pour atteindre ces objectifs, des efforts interdisciplinaires et collaboratifs sont
nécessaires. L’innovation frugale émerge comme un paradigme qui défie les voies d’innovation tradi-
tionnelles et qui peut avoir le potentiel de rassembler les efforts des différentes parties prenantes pour
atteindre les objectifs de développement durable. Cette revue systématique de la littérature analyse les
études actuelles qui relient les concepts d’innovation frugale et de développement durable. L’objectif est
de mettre l’accent sur les approches et les conditions dans lesquelles les innovations frugales peuvent
stimuler le développement durable, notamment en ce qui concerne les différents types d’acteurs du secteur
privé. Sur la base de l’analyse du contenu des études actuelles, nous formulons des lacunes des études
existantes et développons un programme de recherche dans le but de rapprocher les deux axes de
recherche.
The European Journal of Development Research (2017). doi:10.1057/s41287-017-0106-3
Keywords: frugal innovation; sustainability; inclusive development; Base of the Pyramid; sustainable
development
Introduction
Throughout recent decades, sustainable development has risen as a means to address issues of
poverty, ecological damage, and social inequalities. Sustainable development is an approach
whereby society should satisfy its current needs without sacrificing the ability of future
generations to satisfy their own needs (World Commission on Environment and Development,
2017 European Association of Development Research and Training Institutes (EADI) 0957-8811
The European Journal of Development Research
www.palgrave.com/journals
Rosca et al
1987). The concept has been championed by the United Nations (UN), which replaced its 2000
Millennium Development Goals (MDG) with the Sustainable Development Goals (SDG) in
2015, to include important aspects that researchers identified important throughout the previous
decade (United Nations, 2015a) (See Figure 1). The new SDG aims to increase the inclusion of
local communities in the development planning process, to decrease intra- and inter-nation
inequality, and to integrate the three dimensions of sustainable development in a triple bottom
line approach: ecological, economic, and social (United Nations, 2015a, b).
Private firms play a critical role in the success of the SDG. Specifically, they help fund
critical infrastructure projects, conduct research, increase economic trade, and provide
developing communities with employment (United Nations, 2015b). Frugal innovation, an
emerging paradigm that promotes the (re)design of products and services for low- to middle-
income consumers (Knorringa et al, 2016), is increasingly seen as a way private firms can
actively engage in fulfilling the SDG agenda.
Products, services, and systems designed through frugal innovation attempt to minimize the
use of material and financial resources across the various stages of the value chain, to reduce
their initial acquisition and total life cycle costs (including usage and maintenance), thus
requiring lower levels of society’s natural and financial resources (Tiwari et al, 2014). Frugal
innovation is defined by The Economist (2010) as not only the process of redesigning products,
but also ‘‘rethinking [the] entire production processes and business models.’’
Although it is still a young research discipline, frugal innovation scholars attempt to
systematize knowledge and advance the development of the debate. In this sense, several
literature reviews have already been conducted. Weyrauch and Herstatt (2017) identify the
most common attributes of frugal innovation mentioned in the literature in order to converge to
a common understanding, and Tiwari et al (2016) identify main schools of thought and
theoretical perspectives. While these efforts are very useful to bring together a fragmented
Figure 1: Transformation of the Millennium Development Goals to Sustainable Development Goals

(Based on UN, 2015a, b).
research stream and further advance the field, this study responds to the call for research that
connects frugal innovation with sustainable development objectives (Hart et al, 2016).
Several researchers have already pointed out potential contributions of frugal innovation to
various aspects of sustainability. Frugal innovations may contribute to sustainable development
by providing developing communities with the increased ability to purchase products that fit
their needs, reducing the usage of natural resources and creating inclusive economic growth
through the involvement of local communities in the value chain (Baud, 2016; Knorringa et al,
2016). At the same time, frugal innovations provide profit opportunities for firms – satisfying
the profit motive, which – although not the sole motivation for a firm to partake in sustainable
actions – is still a critical one (Friedman, 1962; Schaltegger and Hörisch, 2015; Tata and
Matten, 2016). However, current empirical work suggests that frugal innovations are not
inherently sustainable (Rosca et al, 2016; Levänen et al, 2015). The provision of affordable
products and services does not address structural roots of poverty (Nahi, 2016). Similarly,
reduced resource usage does not directly translate into environmental protection. Sustainable
development understood as socially inclusive and environmentally friendly economic growth is
a complex, multifaceted challenge which requires interventions at various levels and from
different stakeholders (Sachs, 2015). In this sense, it is important to explore in-depth if, how
and when frugal innovations can drive sustainable development.
Individual research suffers from several limitations that prevent a clear understanding of frugal
innovation’s role in supporting sustainable development. Firstly, studies mostly mention potential
contribution without further evaluation of the impact on SDG. Secondly, researchers often do not
address an integration of all three sustainability dimensions and rely upon theoretical arguments
without providing empirical support. Thus, a systematic literature review is conducted in this
research in order to gain a robust knowledge on how frugal innovations can conceptually and
empirically contribute to various aspects and dimensions of sustainable development. The review
aims to depict the current content of the frugal innovation discourse and highlight schools of
thought, approaches, and conditions in which frugal innovations can drive sustainable
development, all while considering the various types of private sector actors. Furthermore, we
evaluate existing links between frugal innovation and sustainable development and highlight the
shortcomings of existing research, research gaps, and future research avenues.
The remainder of the paper is organized as follows: The next section provides background
information on frugal innovation followed by an overview of the link between frugal
innovation and sustainability research. Thereafter, the methodology of the systematic literature
review is detailed. The results are then revealed, leading to a discussion of the shortcomings of
current studies and research outlook. Finally, the paper concludes with a brief summary.
Frugal Innovation: Perspectives and Theoretical Antecedents
The historical roots of frugal innovation are often traced back to the Appropriate Technology
ideas of Schumacher (1973). Schumacher’s ideas came as a manifesto against the large-scale,
capital-intensive technologies transferred from high-income to low-income countries, which he
argued were largely inappropriate for local settings in low-income countries (Schumacher,
1973). Because of this, Schumacher proposed that the development of appropriate technologies
– ‘‘labor intensive, simple to operate and repair, producing for low income consumers at small
scales and with minimally-harmful impact on the environment’’ – should lead the way towards
poverty alleviation and development (Kaplinsky, 2011, p. 195). Since these ideas were mostly
popular among Non-Governmental Organizations (NGO) and development agencies,
Rosca et al
appropriate technologies spread through as acts of charity rather than profit-seeking

motivations (Kaplinsky, 2011). In this context, frugal innovation emerged in the later 2000s
as ‘‘for-profit appropriate technology’’, emphasizing the role of the profit-motivated private
sector, which is a key innovation partner in the contemporary global economy and development
economics (Kaplinskly, 2011; United Nations, 2015b). The interest in frugal innovation
developed with the influential ideas of Prahalad (2006), who raised the attention of
multinationals on the untapped market potential at the Base of the Pyramid (BOP).1 Yet, the
frugal innovation paradigm goes beyond the BOP narrative by challenging traditional
innovation pathways, from idea to final use, by rethinking entire production processes and
business models (Radjou and Prabhu, 2014). Frugal innovation brings together multiple
stakeholders from formal and informal sectors across geographical regions and combines top-
down with bottom-up approaches (Knorringa et al, 2016; Papaioannou, 2014).
Within the young field of frugal innovation, terminology is used interchangeably in
literature, all pointing to the same phenomenon but different aspects of it. A short list of the
most used terms includes the following forms of innovation: resource-constrained, reverse,
Jugaad, grassroots, Ghandian, indigenous, and inclusive.2 Weyrauch and Herstatt (2017)
identify the most common attributes that literature associated with frugal innovations, revealing
the following characteristics:
‘‘Functional and focused on essentials’’, ‘‘considerably lower initial cost or purchase price’’,
‘‘reducing the cost of ownership’’, ‘‘minimize the use of material and financial resources’’, ‘‘user-
friendly and easy to use’’, ‘‘robust’’, ‘‘high-value and quality’’, ‘‘scalable and sales of large numbers’’
and ‘‘sustainable.’’
A large array of influential literature on frugal innovation emphasizes the focus on low and
emerging middle-income consumers and producers in developing economies (e.g., Bhatti,
2012; Zeschky et al, 2014; Knorringa et al, 2016). For instance, Cunha et al (2014) distinguish
between three main research streams in the context of resource-constrained environments,
namely bricolage for lack of material resources, improvization for lack of time, and frugal
innovation for the lack of affluent consumers. Additionally, Tiwari et al (2016) identify four
main literature clusters in their bibliographic study of frugal innovation literature – all of them
with a focus on developing economies.
Sustainable Development and Frugal Innovation
As an intellectual pursuit, sustainable development attempts to make sense of complex

interactions between the global economy, civil society and the physical environment and ‘‘calls
for a world in which economic progress is widespread, extreme poverty is eliminated, social
trust is encouraged through policies that strengthen the community, and the environment is
protected from human-induced degradation’’ (Sachs, 2015, p. 3). The UN World Summit on
Sustainable Development (2002) defines sustainable development by referring to ‘economic
development, social development and environmental protection as interdependent and mutually
reinforcing pillars’ (p. 2). Therefore, sustainable development is a process for growth and
progress, with the goal of creating sustainability by balancing between economic, social and
ecological aspects (Dovers and Handmer, 1992).
The three aspects that need to be balanced for sustainable development are often
conceptualized as three dimensions: economic, social, and ecological (Bocken et al, 2014).
Economic growth from the perspective of firms includes aspects such as sales, customer
satisfaction, profitability, stability, and future prospects. It is perceived as a pre-requisite for a

firm’s focus on social and ecological impacts since it threatens the firm’s survival (de Beule and
Verwaal, 2014). The social development perspective incorporates aspects related to employ-
ment and income, safety and security, governance, quality of human life, and public services
(ibid). Ecological development refers to aquatic and terrestrial biodiversity preservation, air
quality, material, water and energy use, renewables and natural resource management (ibid).
Ecological economists distinguish between efficiency (supply side) and sufficiency (demand
side) approaches for sustainable development (Roiland, 2016; Bocken and Short, 2016).
Efficiency approaches refer to supply-side measures, which aim to decrease production inputs
of material, energy and labor, thus, doing more with less (Bocken and Short, 2016, p. 42). On
the other hand, sufficiency approaches refer to the demand-side and aim at decreasing general
consumption levels, thus, ‘‘encouraging consumers to make do with less’’ (ibid).
Since the new millennium, research on sustainable development has focused on increasing
the inclusion of local communities in their own development planning and decreasing
inequality within and between nations (Castro, 2004). The United Nations echoes the
importance of these characteristics in their replacement of the Millennium Development Goals
(MDG) with the new Sustainable Development Goals (SDG) (See Figure 1). For example, goal
6b of the SDG specifically targets local participation in development and local communities’
empowerment and engagement. The UN states that previous development strategies were
‘insufficiently inclusive’ (United Nations, 2015b, p. 1) to properly address poverty reduction.
The focus on inclusion and bottom-up approaches derives from critical past learnings. Scholars
alongside internal UN agencies realized that the main shortcoming of the MDG – similar to
previous efforts – has been the top-down approach to development that does not focus enough
on establishing favorable local conditions, local capacity building, and engagement of local
communities (Bond, 2006).
Tackling ecological issues also takes a more pronounced importance in the SDG. On climate
change, the United Nations states that: ‘‘adverse impacts [of climate change] undermine the
ability of all countries to achieve sustainable development’’ (2015b, p. 6). Therefore, the SDG
recognize and promote inter- and intra-dependencies between the economic, social, and
ecological sustainability dimensions and emphasize that a sustainable development approach
should balance and harmonize all of them.
Frugal innovation, with its focus on the frugal usage of resources, inclusion of low-income
actors, and its nature of bringing together stakeholders may offer potential for sustainable
development pathways. Baud (2016) builds on the work of Knorringa et al (2016) and argues
that for frugal innovation to enable more inclusive development processes, three conditions
need to be satisfied. First, firms should commercialize affordable frugal products and services.
Second, low-income actors should be engaged in value chain activities. Third, natural resources
should be employed in a frugal manner. Cunha et al (2014) argue that frugal innovation is of
paramount importance to create a future in which firms face increased social pressures to
integrate sustainability in their operations and to learn how to do more with less.
An important aspect of the frugal innovation debate is the various types of private sector
enterprises and their potential contributions. Most often cited examples of frugal innovations
involve both products and services provided by multinational corporations (MNC),3 for
example the healthcare devices developed by Siemens, General Electric or TATA; local large
companies such as Aravind Eye Care in India; foreign small- and medium-sized enterprises
(SME) such as Mobisol4 and SimGas5; and local initiatives, e.g., Mitticool fridge in India.
Among local initiatives, we can distinguish between two styles of enterprises: first, local
survival enterprises, which are necessity-driven, street economy types of micro-businesses that
Rosca et al
are embedded in networks of families and have no clear goals to grow; second, growth oriented
enterprises, which are more specialized, opportunity-driven ventures embedded in business
networks and willing to expand (Berner et al, 2012). Given the nature of these types of
initiatives, the available resources, capabilities and know-how, as well as motivations and
mindsets, the approaches employed by different types of private actors differ. Subsequently,
they may have different impacts on sustainable development.
Despite the theoretical connections between sustainable development and frugal innovation
suggested by scholars, the field has been insufficiently researched. Although various
researchers do emphasize the potential links between the two concepts, the arguments revolve
around the same ideas, namely lower usage of resources during the entire product life cycle,
affordable basic products/services, and the inclusion of low-income actors. Yet, sustainable
development is a holistic concept with multiple dimensions and interrelations. Thus, a holistic
perspective is needed.
To address past shortcomings, this literature review evaluates conceptual and empirical
studies on frugal innovation, and adopts a range of comprehensive indicators for sustainable
development aiming to map different perspectives, approaches, and implications. A novel
contribution of this work is the linking of different approaches and tools employed by various
types of private sector actors in order to distinguish contributions and limitations. Therefore,
this study contributes to cross-fertilization between frugal innovation and sustainable
development research and defines a research agenda with regard to the potential outcomes of
different types of actors. By pointing out the potential contributions of different types of actors,
further research efforts can be streamlined.
Methodology
This study employs a systematic literature review as an underlying research methodology.

Systematic literature reviews can be viewed as content analysis where qualitative and
quantitative dimensions are employed in order to capture structural and content-related
qualities of the investigated field of literature (Brewerton and Millward, 2001). Systematic
literature reviews are unique because they adopt ‘a replicable, scientific and transparent
process’ that aims to identify key research on a given research question (Tranfield et al, 2003,
p. 209). As such, systematic literature reviews can be conducted for specific issues to depict the
conceptual content of the field by summarizing emerging themes and patterns (Meredith, 1993).
They are also valuable tools to map and evaluate the contributions of a sub-discipline for a
specific research question or issue (Fink, 2005).
A four stage approach – from collecting literature to analyzing the contents – based on
Mayring (2003) was employed in order to study the potential effects of frugal innovation on
sustainable development (See Figure 2). In Stage I, multiple databases were searched for
relevant literature using various keywords related to the research goal – determining how frugal
innovations affect the three dimensions of sustainability. Our original research included several
additional keywords, such as BOP, disruptive and resource-constrained innovation. However,
these keywords were excluded from the search based on the feedback of academic peers in the
field of frugal innovation.
Specifically, the keyword BOP opens up a different and immense academic debate, thus
diluting the results and reducing the focus on frugal innovation. Moreover, although we initially
attempted to only screen articles with the keywords frugal innovation and sustainability, we
found that there are many ways in which authors can refer to a topic that is related to
Figure 2: Four-stage methodology of the systematic literature review.
sustainability without actually using the word sustainability, such as poverty alleviation, human
development, waste management, and low emissions. In order not to exclude important studies,
we decided to include all articles which explore and discuss frugal innovation, with or without
sustainability-related keywords in title, abstract or author-supplied keywords.
The resulting literature base was screened to ensure the relevance of each article by reading
the abstract. This left a remaining 64 articles published between 2000 and August 2016 on
frugal innovation.
In Stage II, we divided the literature into two categories: conceptual or empirical. Then, we
analyzed the overall structure of the research stream to gain insights on the state of research, the
fields in which it is mostly studied and the level of empirical support for theories. Aside from
the descriptive categories (e.g., year, journal, method), Stage III utilized coding categories and
indicators for each of the three sustainability dimensions based on the Global Reporting
Initiative guidelines (based on de Beule and Verwaal, 2014). The social and ecological
sustainability dimensions specified in Table 1 include a list of keywords that we used to
identify relevant content in the articles for each dimension. Therefore, the coding of the articles
employed a content analysis technique.
In the Stage 4, the body of research was coded so that the overall literature could be
analyzed. The paper was revised several times as a result of feedback and critique provided by
academic peers.
Findings
Frugal innovation: a rapidly evolving academic discipline

As shown in Figure 3, the volume of research on frugal innovation has grown considerably in
the past decade – peaking in the partial year 2016 with more than six times as many articles
than in 2004–2010 combined. The growing interest in the field has mainly materialized through
the increase in articles from publications focusing on more specialized fields: sustainability,
Rosca et al
Table 1: List of keywords for social, ecological, and economic development
Social Employment and wages, skills level, entrepreneurship, physical safety, resistance to
development natural disasters, resistance to climate change, information transparency from
government, legal system integrity, political decision-making, infrastructure,
basic needs, discrimination, human rights, education, health education,
healthcare services
Ecological Efficiency, sufficiency, terrestrial ecosystem, biodiversity, health of marine and
development aquatic systems, air quality, material use, water use, energy, renewable energy,
waste management, natural resource management
Economic Sales, customer satisfaction, profitability, financial stability, future prospects
development
Figure 3: Volume of research and originating research discipline by year.
technology and innovation management and engineering. Furthermore, the publication of

empirical studies has increased, with studied geographies ranging over several continents.
While only 33 per cent of all articles were empirical in nature, the number of empirical works
exceeded conceptual works in the partial year 2016, with almost half of all empirical works
being published in that year. This increased specialization and empirical nature of the research
indicates three trends. First, researchers are increasingly interested in addressing the operational
implementation of frugal innovations through technical disciplines, which indicates a more
advanced research stream (e.g., Lehner and Gausemeier, 2016, Altmann and Engberg, 2016 –
technology management; Baud, 2016 – development research; Tran and Ravaud, 2016 – health
research and medicine; Belkadi et al, 2016 – production and manufacturing systems).
Second, the increase in empirical studies also indicates a developing research field looking
to further progress by evaluating and testing previous theoretical claims. Empirical studies are
mostly in the form of case studies on frugal innovation (see Rosca et al, 2016; Levänen et al,
2015; Pansera and Sarkar, 2016).
Third, the focus on frugal innovation’s contribution to sustainable development has
increased considerably, as evident by the increase in top sustainability journals publishing
articles on frugal innovation (e.g., Journal of Cleaner Production, Sustainability). Recent
articles suggest that the environmental and sustainability management fields are adopting frugal
innovations as a sustainability-enhancing approach, and they work to integrate it with concepts
and approaches from their disciplines. The number of scientific articles on frugal innovation
that specify sustainability/sustainable development in their title, abstract or author-supplied
keywords has grown significantly in the last years.
We discuss the emerging themes and key studies for socio-economic development and
ecological development by distinguishing between MNC/large companies and local, smaller
initiatives and social enterprises. The narratives on frugal innovation often use combined socio-
economic aspects and thus we structure it like this to ensure a clearer structure.
Socio-economic development: the perspective of MNC and large domestic companies

From the perspective of MNC and large companies as initiators of frugal innovation, the focus
of this stream is on developing new organizational and product development capabilities to
design and bring to BOP markets affordable products and services (e.g., Zeschky et al, 2014;
Rao, 2013; Lim et al, 2013; Ray and Ray, 2011). This stream of literature explores how MNC
can adjust their current organizational structures and approaches to fit the requirements of low-
income consumers (Zeschky et al, 2014), and revolves particularly around: economies of scale;
low-cost of manufacturing, materials and ownership; a focus on basic functionality and
minimal sets of features; frugal product development capabilities; optimized supply chain
operations and collaboration with suppliers (Lim et al, 2013; Tiwari and Herstatt, 2012;
Zeschky et al, 2011). On one hand, empirical studies suggest that MNC should localize not only
manufacturing facilities but also research and development (R&D) facilities in order to
combine local expertise with foreign knowledge (Ojha, 2014; Zeschky et al, 2011). On the
other hand, Altman and Endberg (2016) show that MNC can be successful even without
collaborating with local actors in low-income markets, by employing home-based R&D
capabilities when the transferability of technical knowledge presents challenges. Frugal
innovation challenges traditional innovation and development processes, and therefore is
distinguished from other forms of innovation because the local constraints change the
traditional pathway through which innovation emerges and diffuses (Pansera, 2013; Sharma
and Jha, 2016). Several studies explore how MNC can employ innovations from low-income
markets to open new customer segments in developed economies under the umbrella of reverse
innovation (Shan and Khan, 2016).
In regard to social value creation by frugal innovation initiated by MNC and large domestic
companies, the focus is on (1) provision of affordable products and services to satisfy basic
needs, thereby reducing inequality of consumers to product markets; and (2) the integration of
low-income consumers at various points in the value chain, thereby addressing inequality in the
labor market. Regarding the first point, most studies which adopt the perspective of MNC refer
to the social impact created by the provision of affordable products and services. Customer
social value often takes the form of a value proposition, namely affordability through low total
costs of ownership (usage, maintenance and repair), robustness, underserved needs, function-
ality in extreme conditions, durability and customer-centricity (Tiwari and Hersttatt, 2012; Soni
and Krishnan, 2014; Ray and Ray, 2011). Many articles emphasize that frugal innovation can
increase the quality of life of developing communities’ populations through the provision of
affordable products and services for basic needs. Nevertheless, critics argue that providing
basic products and services to low-income markets does not necessarily translate to poverty
alleviation, because consumption is not the primary issue in poverty (Birtchnell, 2013).
Moreover, Levänen et al (2015) found that MNC still find it hard to overcome traditional
Corporate Social Responsibility (CSR) practices and employ approaches such as creation of
Rosca et al
marketing awareness campaigns and cooperation with NGO to donate products to low-income
people (Levänen et al, 2015).
Pertaining to the inclusion of developing communities into value chains, current studies
refer to the social impact created through local entrepreneurship, skills and capabilities
development, and inclusion of low-income actors as active contributors to value chain
activities. Rosca et al (2016) found that MNC and local companies commercializing frugal
innovations often employ people from vulnerable groups or drive local entrepreneurship,
especially for last-mile delivery services. Frequently, distribution models are designed to
include local entrepreneurs to reach geographically remote areas or combine it with
complementary services aimed at raising awareness and education (Rosca et al, 2016). Kahle
et al (2013) suggest that inclusion of low-income consumers in the formal economy as
producers, suppliers, and employees leads to development of social capital, which in turn leads
to the socio-economic development of local communities, and has democratizing effects. Yet,
this perspective does not come without skepticism, especially regarding the role of MNC who
have been known to exploit informal labor services without alleviating poverty in the past
(Birtchnell, 2013). The nature of unequal power relationships within and between different
stakeholder groups demands tighter regulatory framework to protect poor from exploitation,
and to ensure equal distribution of benefits among society members (Knorringa et al, 2016;
Baud, 2016; Pansera, 2013).
Socio-economic development: the perspective of micro-, small-, and medium-sized (foreign

and local) enterprises and entrepreneurs
Empirical studies adopting the perspective of local entrepreneurs and micro-, small-, and
medium-sized enterprises have taken off in recent years. While these enterprises also provide
affordable products and services to low-income markets, their social development impact is
discussed more in detail by scholars (e.g., Annala et al, 2016; Pansera and Sarkar, 2016;
Pansera and Owen, 2015). Current studies reveal that in the case of small enterprises and local
entrepreneurs, economic and social dimensions are intertwined. For example, Singh et al
(2012) explore frugal innovation from the perspective of BOP households and entrepreneurs,
and show how frugal innovation is a low-cost survival strategy focused on ‘stretching resources
of the poor, to extract more value from smaller resources’. While exploring innovation goals,
processes, and dynamics within social enterprises, Pansera and Owen (2015, p. 309) refer to
hybrid innovation perspectives where affordable innovation, co-creation of social value, and
social innovation narratives are ‘combined and reconfigured to allow affordability, adaptabil-
ity, social empowerment and sustainability in BOP context’. Annala et al (2016) explore the co-
design and co-production of frugal innovations, which allows local small-scale entrepreneurs to
customize their offerings mainly due to local proximity and embeddedness. They also found
that local entrepreneurs, due to their deep knowledge of local systems and engagement with
local communities, avoid costs on marketing and improve customer relationship and complaints
management.
Local entrepreneurs, micro-, small-, and medium-sized enterprises address social develop-
ment through active engagement of low-income markets in operations and local capacity
building activities, thereby (1) addressing inequality in labor markets and (2) filling institutional
gaps. Levänen et al (2015) find that frugal innovation driven by small social enterprises focuses
largely on local capacity building, inclusion of marginalized local people by providing
empowerment and employment of local women and locals with modest education levels, and
reduction of inequalities caused by local social structures (e.g., caste system in India). This
active engagement in local capacity building efforts seems to be driven by strong social
orientation of entrepreneurs, which is required to drive inclusive development (Birtchnell,

2013). Pansera and Owen (2015) investigate the innovation goals, processes, dynamics, and
cognitive processes within social enterprises commercializing frugal innovations to BOP
consumers in Bangladesh, and find that creating social value and ecological awareness are core
ingredients of the enterprise’s identity and mission. Pansera and Sarkar (2016) explore several
cases of green technologies and frugal innovations driven by local entrepreneurs in the energy
sector and explore how new technologies generate employment, income and productivity. They
conclude that grassroots innovators that promote frugal innovations might have the most
critical role to fulfill the SDG’s agenda, because the initiatives usually exhibit the necessary
social orientation for the SDG’s success. Grassroots innovators genuinely aim to improve the
living conditions of their local communities and aspire to empower social minorities (Pansera
and Sarkar, 2016). Similarly, Satar and John (2016) found that social enterprises in the area of
frugal innovation engage actively in the life of local communities and entail a strong social
mission.
Most studies on frugal innovation emphasize various elements of social development as
outcomes of frugal innovations (for an overview of emerging themes and ideas, see Figure 4).
There are only a few indicators for safety and security (2), social governance (10), and public
services (11) and the impact of frugal innovation on such spheres seems to be rather indirect.
Within the public services debate, some scholars argue that frugal innovation deemphasizes the
role of government (Pansera, 2013), while others emphasize that frugal innovation can fill in
important services gaps where government has failed (Knorringa et al, 2016). Empirical studies
have shown how frugal innovations help solve what Prabhu and Jain (2015) call the last-mile
problem, which refers to delivering solutions to remote locations that cannot be reached with
regular government initiatives. Several studies celebrate the potential of frugal innovation to
Figure 4: Social and economic development – emerging themes.
Rosca et al
bring together public and private sector for learning and knowledge creation (Annala et al,
2016; Kahle et al, 2013).
Prabhu and Jain (2015) argue that social enterprises can make real contribution to frugal
innovation driven-inclusive development by also providing role models and inspiration that
inspire other social enterprises to participate.
Ecological development driven by MNC and local initiatives

Scholars often connect the frugal innovation discourse implicitly and/or explicitly with
elements of ecological development. The emerging themes found during this literature review
(see Figure 5) show that this debate brings together elements from both the efficiency and
sufficiency development approaches. While earlier research on ecological economics criticizes
business disciplines for focusing on efficiency-based approaches, this review shows that frugal
innovation brings the sufficiency-based approach to the attention of business scholars. Frugal
innovation is linked with sustainable development through (1) reduced usage of resources at
various points in the production and consumption chains, (2) bringing renewable and clean
technologies to billions of low-income consumers, (3) influence towards green product design
and life cycle approaches, (4) promotion of ecological awareness and education and (5)
promotion of frugality as a mindset.
The initial ecological debates surrounding frugal innovation derive from its philosophy of
doing more with less, and thereby focusing on developing products and services with lower up-
front and life cycle costs, longer product life cycles, and lower gas emissions, noise emissions
and negative health effects (Tiwari and Herstatt, 2012; Brem and Ivens, 2013). Baud (2016)
suggests that one necessary condition for frugal innovations to be sustainable is the frugal use
of natural resources in the production processes (Baud, 2016). Frequently, frugal innovation
creates localization of the value chain with a strong focus on local manufacturing, procurement,
and distribution channels (Rosca et al, 2016). Basu et al (2013) propose that key competences
necessary for frugal innovations to drive sustainability relate to minimalistic product features,
functional requirements, and use of local resources and green technologies. Low-income
settings have provided a fertile ground for bringing technologies to markets to address
ecological issues, and several case studies focus on exploring diffusion of such technologies
along with the development impact (e.g., Pansera and Owen, 2015; Levänen et al, 2015).
Sharma and Iyer (2012) propose how frugal product development enhances green products:
through higher resource productivity (use of off-the-shelf components, easily repaired parts),
supply chain efficiencies, and technology (recycling, decreased input resources) and process
Figure 5: Ecological development – emerging themes.
cobbling, which is the process of using a given technology for new applications, such as smart
phone applications in banking.
The reduced complexity and input of value chain activities result in lower negative external
life cycle impacts (Brem and Ivens, 2013). Insights from frugal product development reveal
that increased focus on the product’s life cycle and modular, human-centered approaches can
also have positive ecological impacts. Shan and Khan (2016) emphasize the ecological benefits
gained by Philips by focusing on employing a product life cycle approach: reduced usage of
resources, energy, hazardous materials and packaging, increased recyclability by employing
modular design, increased product life cycle and reduced obsoleteness.
Frugal innovations often create positive ecological impact beyond their value propositions,
by engaging local communities in education and awareness campaigns, such as M-Pesa’s
campaign for renewable energy (Rosca et al, 2016). Pansera and Owen (2015) found that a key
component of local enterprises’ mission includes the green narrative, namely creating
environmental awareness and addressing environmental constraints. Finally, several scholars
emphasize frugality as a mindset (e.g., Soni and Krishnan, 2014; Roiland, 2016; Alcott, 2008).
Roiland (2016) suggests that using frugal innovation as a management philosophy brings a
different idea of increased quality of life, with more focus on free time and self-realization than
materialism and consumption. This sense of higher quality of life, living with less material
consumption, is advocated by the literature (Alcott, 2008). These ideas may be important not
only for low-income consumers in developing countries, but also rising middle class segments
and consumers in industrialized settings. On the other hand, the sufficiency model is not
necessarily a clear win for economic growth. Bocken and Short (2016), in their exploration of
existing sufficiency-based business models in practice, conclude that while some companies
already adopt sufficiency models, the possible effects of large-scale adoption are still uncertain
since reduced consumption may undermine current economic development.
Preliminary evidence suggests that different types of private sector actors address aspects of
ecological development in different manners. Namely, MNC focus on maximizing resource
efficiencies (see Lim et al, 2013; Zeschky et al, 2011), which yields both cost and ecological
benefits, while local and social enterprises aim to additionally encourage the reuse of materials,
lower consumption patterns, and the development of scale-up solutions (Rosca et al, 2016).
Energy and healthcare as key sectors for sustainable frugal innovations

A large number of articles highlight the importance of frugal innovations in the energy and
healthcare sectors. Frugal innovations in the energy sector are frequently cited in the literature,
ranging from simple solutions such as the Liter of Light and windmills, to more complicated
renewable energies based on solar power, wind and biogas. Nocera (2012) argues that the
energy demands of the rapidly developing communities are increasing dramatically, and the
current centralized and capital-intensive energy solutions based on Western model are
insufficient and inappropriate for sustainable development in emerging markets. Instead, he
suggests that developing economies need light and highly manufacturable as well as robust and
low maintenance energy technologies. In this sense, frugal innovations in the energy sector
have potential to empower local communities through personalized energy solutions and
energy efficient materials, processes, products, and services (Nocera, 2012). Additionally,
energy provision has a multiplier effect on wealth, income, entrepreneurship, and education.
Frugal innovations, especially in the energy sector, have the potential to provide electricity for
remote areas where government institutions and the private sector cannot afford to. In this
sense, decentralized frugal energy systems have potential to fill in institutional gaps in remote
areas in developing countries. Levänen et al (2015) find that frugal innovations in energy
Rosca et al
provision driven by social enterprises save households’ money, by providing less-expensive

energy solutions and creating income by enabling new forms of entrepreneurship and
employing local people.
Frugal innovations in healthcare involve simple, affordable, robust and easy to use
technologies that doctors or patients themselves can use in resource-constrained environments
to either avoid, identify or treat health issues. The impact of frugal innovations in the healthcare
sector goes far beyond simply improving the standard of life: it directly impacts economic
indicators through decreased mortality rates and productivity increases (Rosca et al, 2016).
Examples of frugal innovations in the health care sector are numerous, including Jaipur foot,
Aravind Eye Care, healthcare devices by General Electrics, Philips and Siemens, baby
incubators, and vaccines. Even though numerous frugal innovations are not necessarily health-
related, they have direct effects on the health of low-income actors (Howitt et al, 2012). Such
examples include the eRanger ambulances, water purifiers, clean cooking stoves, car air
purifiers, and sanitation systems.
Despite the proven benefits of frugal innovations in the healthcare sector, their adoption is
not without issues. Shan and Khan (2016) find that frugal innovations often lack clinical
evidence. The lack of clinical evidence, certifications, and international standards is reiterated
by several authors and is especially problematic in health care (Tran and Ravaud, 2016:
Levänen et al, 2015). Developing simple products often means that compliance with rigorous
standards and certifications cannot be achieved, which is often a barrier for MNC to enter low-
income markets with frugal innovations (Levänen et al, 2015).
Discussion
The review of articles at the intersection between frugal innovation and sustainable
development brings forward several important findings. Frugal innovations initiated by MNC
or local enterprises have the potential to increase low-income individuals’ affordable access to
critical products and services and address inequality in labor markets. Also, frugal innovations
can contribute to the development of remote communities in developing countries by bringing
in localized, easy to maintain, and simple solutions. While poverty is a much more multifaceted
concept, and thus consumption is not the primary issue (Birtchnell, 2013; Nahi, 2016), sectors
such as energy or healthcare have a large impact on quality of life, enabling economic and
social growth. Regarding ecological sustainability, frugal innovation brings in the debate on
sufficiency approaches and highlights a combination of efficiency and sufficiency approaches.
At a closer evaluation of approaches employed by MNC versus smaller, local initiatives,
there appear to be differences in how social and ecological issues are addressed. While studies
on MNC emphasize various aspects of economic issues (e.g., innovation capabilities, market
opportunities, cost reduction approaches), studies exploring local initiatives engaged in frugal
innovation highlight aspects such as local capacity building, empowerment of local actors,
enhancement of social justice and human rights. Local initiatives go beyond traditional
innovation approaches and employ hybrid innovation perspectives, where social and/or
ecological aspects are core components of the enterprise’s mission (Pansera and Owen, 2015).
These types of actors and initiatives are usually embedded in the local communities and entail a
strong social orientation. They typically start with a given problem in the community and then
work towards feasible solutions (Annala et al, 2016; Pansera and Sarkar, 2016; Levänen et al,
2015; Pansera and Owen, 2015 – in this review, but supported by other literature findings, for
example Sinkovics et al, 2014). The preliminary empirical evidence emphasizes the important
role of local entrepreneurs and grassroots innovators in sustainable and inclusive development,
supporting the claims of past researchers (e.g., Mair and Marti, 2009).
This review puts forward preliminary ideas and empirical findings. Nevertheless, research at
the intersection of frugal innovation and sustainable development is only in the early stages and
presents avenues for future research. In the following, we explore several shortcomings of
current research and formulate recommendations for future research avenues.
Shortcomings of Current Research: Towards a Research Agenda
First, a large array of articles refers to frugal innovation and possible outcomes for
sustainable development, but does not distinguish between the different typologies of firms
and initiators. Often studies do not adopt a clear perspective or differentiate between private
sector actors when proposing theoretical claims on the impact of frugal innovation for
sustainable development. In this sense, it is important to differentiate between private sector
actors and further advance our understanding on the motivations and contributions of each
group. Such an understanding can facilitate the combination of strengths, competences,
resources and capabilities of different private sector actors and strengthen polycentric
innovation efforts (Knorringa et al, 2016). For example, small initiatives can contribute their
strong local orientation and connection with local consumers, while MNC can bring in their
capabilities and know-how for scaling (international expertise, access to markets, and global
business knowledge). Since the two groups of actors seem to have complementary set of
skills, collaboration is theoretically beneficial to both types of private actors. Further research
should explore the mechanisms and challenges of such collaborations. The literature has
overemphasized the role of MNC and has overlooked other important actors, such as large
domestic companies or foreign driven social ventures. These groups of private actors could
have valuable contributions in the context of linking actors from formal and informal sectors
across countries. Frugal innovation scholars should further study the mechanisms and
outcomes for sustainable development from the perspective of small ecosystems created by
frugal innovation, and frugal innovation’s polycentric nature, based on collaboration efforts
between foreign, local and survival enterprises, MNC, and local companies as well as
governments. There are few studies (none in this review) which attempt to bring together and
explore how different actors interact and create value together (see Seelos and Mair, 2007;
George et al, 2015). Therefore, this complex set of actors, motivations, and implications
require further investigation in order to better understand how frugal innovations can drive
the SDG agenda.
Second, current research lacks a sufficient base of empirical evidence of the economic,
social, and ecological impacts of frugal innovations on sustainable development. From the
perspective of MNC, further research should explore how human capabilities are enhanced
through the provision of affordable products and services, and also how inclusion decreases
inequalities in labor markets. This should be explored on individual, household and community
levels. Ideally, the inclusion should be studied from the perspective of low-income consumers
through longitudinal studies combining quantitative and qualitative approaches to fully
understand the impact at community, regional, and country levels.
Third, one inherent characteristic found across geographical and cultural settings of frugal
initiatives (initiated by small and medium enterprises) is these enterprises’ normative
orientation, and their genuine desire to help and empower their local communities (e.g.,
Pansera and Sarkar, 2016). This finding from our review is aligned with insights from other
research streams (e.g., Sinkovics et al, 2014). In the case of social enterprises, Battilana
Rosca et al
et al (2015) find that a main driver for social enterprise’s social performance is the founding
team’s emphasis on the social mission. In fact, even in large companies, it is often found
that the personal determination and sustainability mindset of leaders drives change and
brings sustainability into the organizational agenda (Stubbs and Cocklin, 2008; Bansal,
2003). This normative orientation, required for inclusive and sustainable frugal innovations,
has important implications for the academic debate focusing on private, profit-seeking firms
at a larger scale. Since the key driver is related to the strong normative orientation of the
founders of local initiatives, further research should explore how founders’ influence can be
institutionalized in the firms’ identities and working culture, to ensure that even after the
inspiring founders leave the firm, the mindset remains the same (Stubbs and Cocklin, 2008;
Bansal, 2003). In the case of small enterprises aiming to address social issues through frugal
innovations, the strong social mission enables significant development outcomes, but can
also pose threats to their long-term survival. Since these enterprises frequently attempt to
generate internal revenues and be self-sufficient, sometimes emphasis on social objectives
can come at the expense of economic value. For example, Battilana et al (2015) found that
a strong social mission driven by the founders in social enterprises negatively affects the
economic productivity of the enterprise, mainly due to decisions related to staff hiring,
resource allocation and decisions within the firm. Therefore, in order to further understand
the effect of the initial orientation on the social and ecological impact of small, local
enterprises, scholars can build on research streams such as social entrepreneurship and
hybrid organizations.
Finally, the link between frugal innovation and ecological development is not sufficiently
addressed by current studies. Research at the intersection between sustainability and low-
income markets in developing countries is still in its early stages, and there are numerous
gaps to explore. The impact of frugal innovations on the health of local terrestrial, aquatic,
and biodiversity systems is not addressed by current literature. The application of
sufficiency-based approaches should be further explored, in particular approaches such as
product service systems (Mont, 2002), localization and focus on local capital (Stubbs and
Cocklin, 2008), cradle to cradle life cycle management and sufficiency-based business
models (Bocken and Short, 2016). From the perspective of the employed sustainability
strategies, further research can explore empirically the applicability, initial investments,
adoption barriers, contributions, and limitations of various strategies for MNC, local
companies, foreign companies, and local initiatives. However, scholars should build more on
strategies, approaches, and empirical findings from the fields of ecological economics,
sustainable business, and supply chain management (where the ecological debate is more
mature). As a guideline for developing new business models for frugal innovation, one can
use sustainability such as deliver functionality rather than ownership, maximize material and
energy efficiency, create value for waste, adopt a stewardship role and encourage sufficiency
(Bocken et al, 2014). There needs to be a change of focus from increasing asset ownership/
accessibility and reworking cost structures to one of increasing benefit ownership and asset
control (Jose, 2008). We argue that frugal innovation can bring in important aspects to help
promote different models that allow for ecologically sustainable consumption and
production in order to meet the needs of the current generation and the future ones. But
in order to do so, scholars should focus more on innovative combinations of efficiency and
sufficiency approaches to bring frugal innovations to markets and thus create sustainability
rather than reduce unsustainability (Ehrenfeld, 2005).
Conclusion
Sustainable development is a holistic, complex process which encompasses various dimensions

and links between key stakeholder groups and issues. Frugal innovation can be a tool for
sustainable development, but it requires combined efforts, competences, resources, and
motivation of several groups of stakeholders, including private sector actors, governments,
development agencies, and civil society (Pansera, 2013). In this study, we performed a systematic
literature review in order to answer the research question posed in the title: Does frugal
innovations enable sustainable development? Sixty-four publications of both conceptual and
empirical nature were reviewed, revealing the current state of research. Findings highlight that
frugal products, services, and systems can have a positive effect on sustainable development, but
are not inherently sustainable. In particular, frugal innovations help to achieve several
components of the UN’s Sustainable Development Goals: increase inclusion in labor markets,
drive local entrepreneurship and capacity building, decrease inequality and promote environ-
mental protection through combination of efficiency and sufficiency approaches. However,
further research should advance our understanding of challenges, barriers, and strategies
employed by frugal innovations to drive sustainable development and contribute with solid
empirical evidence. Our findings suggest that approaches employed by MNC and small and
medium enterprises differ, and subsequently the impact on sustainable development of different
groups of private actors is also different. Since these two groups of actors have complementary
resources and competences, further research should explore opportunities for collaboration
between them, supported by government and development agencies.
This study also entails several limitations. First, as a systematic literature review, the
procedure for searching papers considered only keywords related to sustainable development,
but one can also find useful studies which do not adhere to this keyword restriction. Secondly,
the nature of systematic literature reviews does not allow for the integration of unpublished
manuscripts; thus, important gray literature may have been missed (e.g., Bhatti, 2012; Tiwari
and Hersttat, 2012; The Economist, 2010). Additionally, due to keywords-based search, articles
which refer to similar concepts but use different words may have been missed (e.g., Prahalad
and Mashelkar, 2010; George et al, 2012).
As Ehrenfeld (2005) notes, reducing unsustainability is not the same as creating
sustainability, and one is not simply the converse of the other. He further asserts that, for
the most part, firms’ actions fall into the realm of slowing unsustainability rather than creating
sustainability. Therefore, it is not only the task of the private sector, but rather a collective task
which needs collective action. Yet, in order to reach collective action, the starting point should
be each individual. Schumacher (1973) nicely points out that ‘‘we must thoroughly understand
the problem and begin to see the possibility of evolving a new life-style, with new methods of
production and new patterns of consumption: a life-style designed for permanence’’ (p. 21).
How this ‘life-style designed for permanence’ can be operationalized and aligned with
economic growth and social development remains to be seen.
Notes
1. BOP is a term used for people in the lowest income bracket of the world. The literature frequently
uses various income indicators to map this population segment. Often BOP researchers use thresholds
including annual purchasing power parity ranging between $1500 and $3000 (London, 2007) or daily
income threshold of up to $2 (Banerjee and Duflo, 2007).
Rosca et al
2. For an overview and analysis of related terms, please see Soni and Krishnan (2014), Zeschky et al
(2014), and Brem and Wolfram (2014).
3. European Commission (2003) defines enterprises based on number of employees and suggests that
MSME include less than 250 employees. Companies with more than 250 employees can be local
large companies or MNC (with assets and facilities in several countries).
4. Mobisol is a Berlin-based company offering low-income (especially rural) consumers in Africa solar
energy combined with affordable payment plan via mobile phones.
5. SimGas is Dutch company bringing mass-produced, modular and domestic biogas and bio-sanitation
systems for rural households in Africa and Asia.
References
Alcott, B. (2008) The sufficiency strategy: Would rich-world frugality lower environmental impact?. Eco-
logical Economics 64(4): 770–786.
Altmann, P. and Engberg, R. (2016) Frugal Innovation and Knowledge Transferability: Innovation for
Emerging Markets Using Home-Based RandD Western firms aiming to develop products for emerging
markets may face knowledge transfer barriers that favor a home-based approach to frugal
innovation. Research-Technology Management 59(1): 48–55.
Annala, L., Sarin, A. and Green, J.L. (2016) Co-production of frugal innovation: Case of low cost reverse
osmosis water filters in India. Journal of Cleaner Production (in press).
Banerjee, A.V. and Duflo, E. (2007) The economic lives of the poor. The Journal of Economic
Perspectives 21(1): 141–167.
Bansal, P. (2003) From issues to actions: The importance of individual concerns and organizational values
in responding to natural environmental issues. Organization Science 14: 510–527.
Basu, R.R., Banerjee, P.M. and Sweeny, E.G. (2013) Frugal innovation: core competencies to address
global sustainability. Journal of Management for Global Sustainability 1(2): 63–82.
Battilana, J., Sengul, M., Pache, A.C. and Model, J. (2015) Harnessing productive tensions in hybrid
organizations: The case of work integration social enterprises. Academy of Management Journal
58(6): 1658–1685.
Baud, I. (2016) Moving towards inclusive development? Recent views on inequalities, frugal innovations,
urban geo-technologies, gender and hybrid governance. The European Journal of Development
Research 28(2): 119–129.
Belkadi, F., Buergin, J., Gupta, R.K., Zhang, Y., Bernard, A., Lanza, G., Colledano, M. and Urgo, M.
(2016) Co-definition of product structure and production network for frugal innovation perspectives:
Towards a modular-based approach. Procedia CIRP 50: 589–594.
Berner, E., Gomez, G. and Knorringa, P. (2012) ‘Helping a large number of people become a little less poor’:
The logic of survival entrepreneurs. The European Journal of Development Research 24(3): 382–396.
Bhatti, Y. (2012) What is Frugal, What is Innovation? Towards a Theory of Frugal Innovation. Said
Business School, Working Paper, Oxford, UK.
Birtchnell, T. (2013) Pyramid or iceberg? Problematizing the fortune to be made from India’s austerity.
Marketing Theory 13(3): 389–392.
Bocken, N.M. P. and Short, S.W. (2016) Towards a sufficiency-driven business model: Experiences and
opportunities. Environmental Innovation and Societal Transitions 18: 41–61.
Bocken, N.M. P., Short, S.W., Rana, P. and Evans, S. (2014) A literature and practice review to develop
sustainable business model archetypes. Journal of Cleaner Production 65: 42–56.
Bond, P. (2006) Global governance campaigning and MDGs: From top-down to bottom-up anti-poverty
work. Third World Quarterly 27(2): 339–354.
Brem, A. and Ivens, B.S. (2013) Do frugal and reverse innovation foster sustainability? Introduction of a
conceptual framework. Journal of Technology Management for Growing Economies 4(2): 31–50.
Brem, A. and Wolfram, P. (2014) Research and development from the bottom up-introduction of
terminologies for new product development in emerging markets. Journal of Innovation and
Entrepreneurship 3(1): 1–22.
Brewerton P. and Millward L. (2001) Organizational Research Methods: A Guide for Students and
Researchers. London: Sage.
Castro (2004) Sustainable development: Mainstream and critical perspectives. Organization and
Environment 17(2): 195–225.
Cunha, E., Rego, A., Oliveira, P., Rosado, P. and Habib, N. (2014) Product innovation in resource-poor
environments: Three research streams. Journal of Product Innovation Management 31(2): 202–210.
De Beule, F. and Verwaal, E. (2014) Does the quality of institutions impact the profit motive to do good
for the poor? A contingent resource-based view on inclusive strategies at the ‘‘base of the pyramid’’.
In: Technology: Corporate and Social Dimensions; Annual Conference: Technology: Corporate and
Social Dimensions, Bangalore, India, pp. 357–388.
Dovers, S.R. and Handmer, J.W. (1992) Uncertainty, sustainability and change. Global Environmental
Change 2(4): 262–276.
Ehrenfeld, J.R. (2005) The roots of sustainability. MIT Sloan Management Review 46(2): 23–25.
European Commission (2003) What is an SME? Retrieved on April 20 at: http://ec.europa.eu/growth/
smes/business-friendly-environment/sme-definition_de.
Fink, A. (2005) Conducting Research Literature Reviews: From the Internet to Paper (2nd ed.). Thousand
Oaks, California: Sage Publications.
Friedman, M. (1962) Capitalism and Freedom. Chicago: The University of Chicago Press.
George, G., McGahan, A.M. and Prabhu, J. (2012) Innovation for inclusive growth: Towards a theoretical
framework and a research agenda. Journal of Management Studies 49(4): 661–683.
George, G., Rao-Nicholson, R., Corbishley, C. and Bansal, R. (2015) Institutional entrepreneurship,
governance, and poverty: Insights from emergency medical response services in India. Asia Pacific
Journal of Management 32(1): 39–65.
Hart, S., Sharma, S. and Halme, M. (2016) Poverty, business strategy, and sustainable development.
Organization & Environment 29(4): 401–415.
Howitt, P., Darzi, A., Yang, G.Z., Ashrafian, H., Atun, R., Barlow, J.,… and Cooke, G.S. (2012)
Technologies for global health. The Lancet 380(9840): 507–535.
Jose, P.D. (2008) Rethinking the BOP: New models for the new millennium–academic perspective. IIMB
Management Review 20(2): 198–202.
Kahle, H., Dubiel, A., Ernst, H. and Prabhu, J. (2013) The democratizing effects of frugal innovation:
Implications for inclusive growth and state-building. Journal of Indian Business Research 5(4): 220–234.
Kaplinsky, R. (2011) Schumacher meets Schumpeter: Appropriate technology below the radar. Research
Policy 40(2): 193–203.
Knorringa, P., Peša, I., Leliveld, A. and Van Beers, C. (2016) Frugal innovation and development: Aides
or adversaries? The European Journal of Development Research 28(2): 143–153.
Lehner, A.C. and Gausemeier, J. (2016) A pattern-based approach to the development of frugal
innovations. Technology Innovation Management Review 6(3): 13–21.
Levänen, J., Hossain, M., Lyytinen, T., Hyvärinen, A., Numminen, S. and Halme, M. (2015) Implications
of frugal innovations on sustainable development: Evaluating water and energy innovations. Sus-
tainability 8(1) (in press).
Lim, C., Han, S. and Ito, H. (2013) Capability building through innovation for unserved lower end mega
markets. Technovation 33(12): 391–404.
London, T. (2007) A Base-Of-The-Pyramid Perspective on Poverty Alleviation. Working Paper of the
William Davidson Institute at the University of Michigan and the United Nations Development
Programme (UNDP).
London, T. and Hart, S.L. (2004) Reinventing strategies for emerging markets: beyond the transnational
model. Journal of International Business Studies 35(5): 350–370.
Mair, J. and Marti, I. (2009) Entrepreneurship in and around institutional voids: A case study from
Bangladesh. Journal of Business Venturing 24(5): 419–435.
Mayring P. (2003) Qualitative Inhaltanalyse – Grundlagen und Techniken. [Qualitative content analysis].
8th ed. Weinheim, Germany: Beltz Verlag.
Meredith J. (1993) Theory building through conceptual methods. International Journal of Operations and
Production Management 13(5): 3–11.
Mont, O.K. (2002) Clarifying the concept of product–service system. Journal of Cleaner Production
10(3): 237–245.
Nahi, T. (2016) Cocreation at the base of the pyramid: reviewing and organizing the diverse
conceptualizations. Organization & Environment 29(4): 416–437.
Nocera, D.G. (2012) Can we progress from solipsistic science to frugal innovation? Daedalus 141(3):
45–52.
Rosca et al
Ojha, K.A. (2014) MNCs in India: Focus on frugal innovation. Journal of Indian Business Research 6(1):
4–28.
Pansera, M. (2013) Frugality, grassroots and inclusiveness: new challenges for mainstream innovation
theories. African Journal of Science, Technology, Innovation and Development 5(6): 469–478.
Pansera, M. and Owen, R. (2015) Framing resource-constrained innovation at the ‘bottom of the pyramid’:
Insights from an ethnographic case study in rural Bangladesh. Technological Forecasting and Social
Change 92: 300–311.
Pansera, M. and Sarkar, S. (2016) Crafting sustainable development solutions: Frugal innovations of
grassroots entrepreneurs. Sustainability, 8(1) (in press).
Papaioannou, T. (2014) How inclusive can innovation and development be in the twenty-first century?
Innovation and Development 4(2): 187–202.
Prabhu, J. and Jain, S. (2015) Innovation and entrepreneurship in India: Understanding jugaad. Asia
Pacific Journal of Management 32(4): 843–868.
Prahalad, C.K. (2006) The Fortune Ad the Bottom of the Pyramid: Eradicating Poverty Through Profits.
Upper Saddle River: Wharton School Publishing.
Prahalad, C.K. and Mashelkar, R.A. (2010) Innovation’s Holy Grail. Harvard Business Review 88(7–8):
132–141.
Radjou, N. and Prabhu, J. (2014) Frugal Innovation: How to do More with Less. London: Profile Books.
Rao, B.C. (2013) How disruptive is frugal? Technology in Society 35(1): 65–73.
Ray, S. and Ray, P.K. (2011) Product innovation for the people’s car in an emerging economy.
Technovation 31(5): 216–227.
Roiland, D. (2016) Frugality, a positive principle to promote sustainable development. Journal of
Agricultural and Environmental Ethics 29(4): 571–585.
Rosca, E., Bendul, J. and Arnold, M. (2016) Business models for sustainable innovation – an empirical
analysis of frugal products and services. Journal of Cleaner Production (in press).
Sachs, J.D. (2015) The Age of Sustainable Development. New York: Columbia University Press.
Satar, M.S. and John, S. (2016) A conceptual model of critical success factors for Indian social
enterprises. World Journal of Entrepreneurship, Management and Sustainable Development 12(2):
113–138.
Schaltegger, S. and Hörisch, J. (2015) In search of the dominant rationale in sustainability management:
legitimacy-or profit-seeking?. Journal of Business Ethics (in press).
Schumacher, E.F. (1973) Small is Beautiful: Economics as if People Really Mattered. London: Blond and
Briggs.
Seelos, C. and Mair, J. (2007). Profitable business models and market creation in the context of deep
poverty: A strategic view. The Academy of Management Perspectives 21(4): 49–63.
Shan, J. and Khan, M.A. (2016) Implications of reverse innovation for socio-economic sustainability: A
case study of Philips China. Sustainability 8(6) (in press).
Sharma, A. and Jha, S. (2016) Innovation from emerging market firms: what happens when market
ambitions meet technology challenges?. Journal of Business & Industrial Marketing 31(4): 507–518.
Sharma, A. and Iyer, G.R. (2012) Resource-constrained product development: Implications for green
marketing and green supply chains. Industrial Marketing Management 41(4): 599–608.
Singh, R., Gupta, V. and Mondal, A. (2012) Jugaad—From ‘Making Do’and ‘Quick Fix’to an innovative,
sustainable and low-cost survival strategy at the bottom of the pyramid. International Journal of Rural
Management 8(1–2): 87–105.
Sinkovics, N., Sinkovics, R.R. and Yamin, M. (2014) The role of social value creation in business model
formulation at the bottom of the pyramid–implications for MNEs? International Business Review
23(4): 692–707.
Soni, P. and T. Krishnan, R. (2014) Frugal innovation: aligning theory, practice, and public
policy. Journal of Indian Business Research 6(1): 29–47.
Stubbs, W. and Cocklin, C. (2008) Conceptualizing a ‘‘sustainability business model’’. Organization &
Environment 21(2): 103–127.
Tata, R.N. and Matten, D. (2016) Corporate community involvement in the 21st century. In: D. Barton, D.
Horváth, M. Kipping (eds) Re-Imagining Capitalism: Towards a Responsible, Long-Term Model.
Oxford University Press (Forthcoming). Available at SSRN: https://ssrn.com/abstract=2740687.
The Economist (2010) First break all the rules. 15 April.
Tiwari, R. and Herstatt, C. (2012) Assessing India’s lead market potential for cost-effective
innovations. Journal of Indian Business Research 4(2): 97–115.
Tiwari, R., Kalogerakis, K. and Herstatt, C. (2014) Frugal innovation and analogies: Some propositions
for product development in emerging economies. In: Proceedings of the RandD Management
Conference, 3–6 June, Stuttgart, Germany, pp. 15–23.
Tiwari, R., Kalogerakis, K. and Herstatt, C. (2016) Frugal innovations in the mirror of scholarly discourse:
Tracing theoretical basis and antecedents. In: Proceedings of the RandD Management Conference,
3–6 July, Cambridge, UK.
Tran, V.T. and Ravaud, P. (2016) Frugal innovation in medicine for low resource settings. BMC Medicine
14(1) (in press).
Tranfield, D., Denyer, D. and Smart, P. (2003) Towards a methodology for developing evidence-informed
management knowledge by means of systematic review. British Journal of Management 14(3):
207–222.
United Nations (2015a) The Millennium Development Goals Report. United Nations: Retrieved
from:http://www.un.org/millenniumgoals/2015_MDG_Report/pdf/MDG%202015%20rev%20(July%
201).pdf.
United Nations (2015b) Transforming Our World: the 2030 agenda for sustainable development. (A/RES/
70/1). United Nations: Retrieved from: https://sustainabledevelopment.un.org/content/documents/
21252030%20Agenda%20for%20Sustainable%20Development%20web.pdf.
Weyrauch, T. and Herstatt, C. (2017) What is frugal innovation? Three defining criteria. Journal of Frugal
Innovation 2(1): 1.
World Commission on Environment and Develoopment (WCED) (1987) Our Common Future. Bruntland
Commission.
Zeschky, M.B., Winterhalter, S. and Gassmann, O. (2014) From cost to frugal and reverse innovation:
Mapping the field and implications for global competitiveness. Research-Technology Management
57(4): 20–27.
Zeschky, M., Widenmayer, B. and Gassmann, O. (2011) Frugal innovation in emerging markets. Re-
search-Technology Management 54(4): 38–45.
Appendix A
See Table A1.
Table A1: List of final papers coded for the systematic literature review in alphabetical order
Authors Year
Agnihotri 2015
Alcott 2008
Altman and Endberg 2016
Angot and Ple 2015
Annala and Green 2016
Barclay 2014
Basu et al 2013
Baud 2016
Belkadi et al 2016
Birtchnell 2011
Bocken and Short 2016
Brem and Ivens 2013
Brem and Wolfram 2014
Chaix and Torre 2014
Colledani et al 2016
Dandonoli 2013
Devarapalli and Figuera 2015
Fukunda and Watanabe 2011
Harris et al 2012
Rosca et al
Table A1: continued

Authors Year
Hartley 2015
Hossain et al 2016
Howitt et al 2012
Kahle et al 2013
Knorrringa et al 2016
Kumar 2008
Leavy 2014
Lehner and Gausemeier 2016
Levänen et al 2016
Lhuissier 2012
Lim et al 2013
Mouritits et al 2016
Nair et al 2015
Niemer et al 2014
Nocera 2012
Ojha 2014
Pansera 2013
Pansera and Owen 2015
Pansera and Sarkar 2016
Polinska 2015
Prabhu and Gupta 2014
Prabhu and Jain 2015
Prathap 2014
Rai 2012
Rai 2015
Rao 2013
Rao 2014
Rego et al 2014
Roiland 2016
Rosca et al 2016
Sako 2015
Satar and John 2016
Shan and Khan 2016
Sharma and Jha 2016
Shoham and Brencic 2004
Simula Hossain and 2015
Halme
Singh et al 2012
Soni Krishnan 2013
Tiwari and Herstatt 2012
Tran and Ravaud 2016
Warner and Caudill 2013
Zeschky et al 2011
Zeschky et al 2014

Rosca, Reedy, Bendul - 2018 - Does Frugal Innovation Enable Sustainable Development A Systematic Literature Review

Uploaded by

Copyright:

Available Formats

Rosca, Reedy, Bendul - 2018 - Does Frugal Innovation Enable Sustainable Development A Systematic Literature Review

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Rosca, Reedy, Bendul - 2018 - Does Frugal Innovation Enable Sustainable Development A Systematic Literature Review

Uploaded by

Copyright:

Available Formats

Special Issue Article

Does Frugal Innovation Enable Sustainable Development?

The European Journal of Development Research (2017). doi:10.1057/s41287-017-0106-3

Figure 1: Transformation of the Millennium Development Goals to Sustainable Development Goals

Frugal Innovation: Perspectives and Theoretical Antecedents

appropriate technologies spread through as acts of charity rather than profit-seeking

Sustainable Development and Frugal Innovation

As an intellectual pursuit, sustainable development attempts to make sense of complex

satisfaction, profitability, stability, and future prospects. It is perceived as a pre-requisite for a

This study employs a systematic literature review as an underlying research methodology.

Figure 2: Four-stage methodology of the systematic literature review.

Frugal innovation: a rapidly evolving academic discipline

Table 1: List of keywords for social, ecological, and economic development

Figure 3: Volume of research and originating research discipline by year.

technology and innovation management and engineering. Furthermore, the publication of

Socio-economic development: the perspective of MNC and large domestic companies

Socio-economic development: the perspective of micro-, small-, and medium-sized (foreign

orientation of entrepreneurs, which is required to drive inclusive development (Birtchnell,

Figure 4: Social and economic development – emerging themes.

Ecological development driven by MNC and local initiatives

Figure 5: Ecological development – emerging themes.

Energy and healthcare as key sectors for sustainable frugal innovations

provision driven by social enterprises save households’ money, by providing less-expensive

Shortcomings of Current Research: Towards a Research Agenda

Sustainable development is a holistic, complex process which encompasses various dimensions

See Table A1.

Table A1: continued

You might also like