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January, 2012:

Eco- Innovation at the bottom of the pyramid

Changing paradigms and new trajectories in emerging economies

Uberaba is a small town of the State of Minas Gerais in Brazil. In 2002, in response to continuous and long electrical shortages, Mr Alfredo Moser discovered that it is possible to illuminate his house with solar light using plastic bottles hanging from the roof. After nearly 10 years, MyShelter Foundation remodelled this simple innovation and began to install it in the peripheral slums of Manila, Philippines. By September 2011, around 15,000 “Liter Bottles” were already providing sun-light to thousands of shanks all around the country. This simple, and smart solution, which costs just 1 dollar, is an amazing example of “eco-friendly frugal innovation” and, according to its promoters, it is likely to spread to other Asian countries.

The “Liter Bottle” case is not an isolated case of simple eco-innovation fostered by energy and resource scarcity in developing countries. Massive mobilizations for a better use of natural resources and a more equal distribution of basic needs such as energy and fresh water have been common in the last two decades of globalization. The struggles for rain forest preservation in the Amazon Basin, for accessing  clean water in Bolivia or for a sustainable use of land in India demonstrate that the so-called “Bottom of the Pyramid” is far to be indifferent to sustainability issues. On the other hand, different changes are taking place in emerging countries that involve processes much more complex than frugal innovation. China, for instance, is already pushing towards the implementation of the “Law of Circular Economy”, which came into force on January 2009. Brazil and its neighbours are looking for new strategic plans to reduce the impact of their soaring growth on the precious biodiversity of the region. There are several promising signals that are challenging the idea that “poor are too poor to eco-innovate”.

The Developing world represents 80% of humanity. In the near future, the access to basic needs in a world of 7 billion people will be strongly influenced by this big mass. Their consumption patterns and their approach to sustainability will undoubtedly reshape the scenario of global economy.

But, which are the emerging countries? And how are they coping with resource scarcity and environmental problems? Such questions have been largely neglected by Western analysers. However, the ethnography of the 20th century discovered that many traditional societies can be very resilient and adaptable to environmental changes. Local knowledge has been co-evolving with nature for centuries creating the condition for dynamic equilibria that industrial societies have irremediably lost. The future will certainly require further changes to meet those essential goals needed to compete in a global economy. However those countries already have several assets. Less developed countries, indeed, can avoid mistakes made by industrialized countries during the early stages of development. They can learn from the mistakes of the others and pioneer new socio-technical trajectories. They can also acquire mature technology without investing a huge amount of money in R&D activities. Finally, most developing countries’ economies are still based on traditional habits of production and consumption. Several productive processes are still carried out in a sustainable way, even though they have a very low efficiency. In other words, the main argument here is that not only are Emerging Economies an immense Living Lab for innovation, as Prahalad argued in his book “The fortune at the bottom of pyramid[i], but also an interesting forge of sustainable practices.

The fascinating point of this argument is whether or not emerging countries will be able to trigger a change of paradigm, in the Kuhnian sense, on a global basis that can provide an alternative development to the present globalization process. This change is likely to succeed only if it will be able to conceive innovation as an inclusive process and provide a more egalitarian development. This implies a new perspective of suitability problems in the developing world designed to reduce the environmental conflicts generated during the globalization process and condensed in the concept of an “Environmentalism of the poor”[ii] created by Joan Martinez-Alier.

The understanding, thus, of the evolution of sustainable innovations in the so-called South of the world is crucial. There is an extensive literature that shows how socio-technological regimes rise in specific conditions that can be hardly reproduced in other contexts. So, first of all, it is needed to identify the initial conditions that originate new and alternative paths of innovation in developing countries. In other words, it is necessary to understand how and why eco-innovation occurs in a great variety of contexts different than the western industrialised countries. In the last decade, indeed, the dynamic of innovation in the West has been largely studied and understood. We know that, once a dominant socio-techno paradigm is well established, only incremental changes tend to take place. The exiting question for the future research agenda is if emerging countries are able to trigger new frames. If so, many other questions will become germane. How much will they consume? How will they keep warm, cook, move and so on?

In this scenario it is relevant to formulate a very stimulating hypothesis: Emerging countries are a fruitful reservoir of innovations and sustainable practices. In order to validate such an assumption, it is not only crucial to provide evidence that eco-innovation is taking place somehow in there, but also to identify the factors that drive and govern this process. It would not be surprising to discover that sustainability and resilience in the developing world still rely on social values and traditional knowledge.

Nevertheless,  it is intriguing thinking that emerging economies, at least potentially, might trigger a new alternative frame, it becomes extremely important to quantify the extent of such a change. The last decade has seen an increasing connection between emerging countries like China, Latin America and some African countries. China is already exchanging infrastructures for natural resources in Africa and Brazil is playing a similar role with its neighbours. As they share expectations and problems, it would be interesting to understand the process of sustainable practices diffusion between these countries. Even more important might be to find out if those practices can potentially have a disruptive impact on industrialised countries leading to what Seely-Brown calls Innovation blowback[iii].

According to Carlota Perez, who has deeply studied the dynamic of the Kondratieff cycles of modern capitalism, the next socio-technical revolution is likely to be a Sustainable Transition[iv]. As R. Kaplinsky argues, “there are many reasons to believe that changes originating in the South will become a major driver of innovation in the 21st century[v]”. it is probably  too ambitious to think that Emerging Economies will lead a global sustainable transition, but it is  improbable that they are going to be simply passive spectators.


[i] C.K. Prahalad, 2010. The fortune at the bottom of the pyramid. 2nd edition. Pearson Education.

[ii] J. Martinez-Alier, 2002. The environmentalism of the poor: a study of ecological conflicts and valuation. Edward Elgar.

[iii] J. Seely Brown, 2005. Innovation Blowback: Disruptive management practices from Asia. McKinsey quarterly.

[iv] C. Perez, 2002. Technological Revolution and Financial Capital. Edward Elgar.

[v] R. Kaplinsky, 2011. Schumacher meets Schumpeter: Appropriate technology below the radar. Research Policy 40. 193-203.

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