Frugal Innovation and Development: Aides or Adversaries?

Frugal innovation aims to bring products, services and systems within the reach of billions of poor and emerging middle-class consumers. Through significantly cutting costs while safeguarding user value, frugal innovation opens opportunities for new business models and may well disrupt innovation processes in entire economies. The debate on the developmental implications of frugal innovation is ideologically polarized. Whereas advocates suggest a business view of ‘win-win’ in which companies can earn profits while simultaneously alleviating poverty, critics argue that frugal innovation will merely exacerbate capitalist exploitation and inequality. In this contribution we argue that an empirical approach is needed to assess where and when frugal innovation is more likely to enhance inclusive development.