Creativity and Growth in: Edmund Phelps (2013),Mass Flourishing. How Grassroots Innovation Created Jobs, Challenge and Change

This article reviews the thesis presented by Edmund Phelps, Mass Flourishing. How Grassroots Innovation Created Jobs, Challenge and Change (Princeton University Press, 2013) that modern economic growth is an indirect outcome of human creativity, and that the object of enlightened policy ought to be to promote this creativity, or flourishing, rather than economic growth per se. The book is a remarkable contribution to the literature on economic growth, with its focus on how entrepreneurship and innovation generates endogenous growth and, more importantly to the author, improves human satisfaction.

BoP and MNCs: where is the market and where the source of innovation?

ln 2004 Prahalad made managers aware of the great economic opportunity that the population at the BoP (Base of the Pyramid) could represent for business in the tom of new potential consumers. However, MNCs (Multi-National Corporations) have continued to fail in penetrating low income markets, arguably because applied strategies are often the same adopted at the top of the pyramid. Even in those few cases where products get re-envisioned, theie introduction in contexts of extreme poverty only induces new needs and develops new dependencies. At best the rearrangement of business models by MNCs has meant the realization of CSR (Corporate Social Responsibly) schemes that have validity from a marketing perspective, but still lack the crucial element of social embeddedness (London & Hart, 2004). Today the challenge is lo reach the lowest population tier with reinvented business models based on principles of value co-creation. Starting from a view of the potential consumer at the BoP as a ring of continuity in the value chain process – a resource that can itself produce value - this paper concludes proposing an alternative innovative approach to operate in developing markets that overturns the roles of MNCs and the BoP. The proposed perspective of ‘reversed' source of innovation and primary target market builds on two fundamental tenets: traditional knowledge is rich and greatly unexploded, and markets at the lop of the pyramid are saturated with unnecessary products / practices that have lost contact with the natural environment.

BoP and MNCs: where is the market and where the source of innovation?

ln 2004 Prahalad made managers aware of the great economic opportunity that the population at the BoP (Base of the Pyramid) could represent for business in the tom of new potential consumers. However, MNCs (Multi-National Corporations) have continued to fail in penetrating low income markets, arguably because applied strategies are often the same adopted at the top of the pyramid. Even in those few cases where products get re-envisioned, theie introduction in contexts of extreme poverty only induces new needs and develops new dependencies. At best the rearrangement of business models by MNCs has meant the realization of CSR (Corporate Social Responsibly) schemes that have validity from a marketing perspective, but still lack the crucial element of social embeddedness (London & Hart, 2004). Today the challenge is lo reach the lowest population tier with reinvented business models based on principles of value co-creation. Starting from a view of the potential consumer at the BoP as a ring of continuity in the value chain process – a resource that can itself produce value - this paper concludes proposing an alternative innovative approach to operate in developing markets that overturns the roles of MNCs and the BoP. The proposed perspective of ‘reversed' source of innovation and primary target market builds on two fundamental tenets: traditional knowledge is rich and greatly unexploded, and markets at the lop of the pyramid are saturated with unnecessary products / practices that have lost contact with the natural environment.

Success and failure of grassroots innovations for addressing climate change: the case of the Transition Movement

Grassroots innovations emerge as networks generating innovative solutions for climate change adaptation and mitigation. However, it is unclear if grassroots innovations can be successful in responding to climate change. Little evidence exists on replication, international comparisons are rare, and research tends to overlook discontinued responses in favour of successful ones. We take the Transition Movement as a case study of a rapidly spreading transnational grassroots network, and include both active and non-active local transition initiatives. We investigate the replication of grassroots innovations in different contexts with the aim to uncover general patterns of success and failure, and identify questions for future research. An online survey was carried out in 23 countries (N=276). The data analysis entailed testing the effect of internal and contextual factors of success as drawn from the existing literature, and the identification of clusters of transition initiatives with similar internal and contextual factor configurations. Most transition initiatives consider themselves successful. Success is defined along the lines of social connectivity and empowerment, and external environmental impact. We find that less successful transition initiatives might underestimate the importance of contextual factors and material resources in influencing success. We also find that their diffusion is linked to the combination of local-global learning processes, and that there is an incubation period during which a transition initiative is consolidated. Transition initiatives seem capable of generalising organisational principles derived from unique local experiences that seem to be effective in other local contexts. However, the geographical locations matter with regard to where transition initiatives take root and the extent of their success, and ‘place attachment’ may have a role in the diffusion of successful initatives. We suggest that longitudinal comparative studies can advance our understanding in this regard, as well as inform the changing nature of the definition of success at different stages of grassroots innovation development, and the dynamic nature of local and global linkages.

The diffusion of grassroots innovations for sustainability in Italy and Great Britain: an exploratory spatial data analysis

Little research so far has been devoted to understanding the diffusion of grassroots innovation for sustainability across space. This paper explores and compares the spatial diffusion of two networks of grassroots innovations, the Transition Towns Network (TTN) and Gruppi di Acquisto Solidale (Solidarity Purchasing Groups – GAS), in Great Britain and Italy. Spatio-temporal diffusion data were mined from available datasets, and patterns of diffusion were uncovered through an exploratory data analysis. The analysis shows that GAS and TTN diffusion in Italy and Great Britain is spatially structured, and that the spatial structure has changed over time. TTN has diffused differently in Great Britain and Italy, while GAS and TTN have diffused similarly in central Italy. The uneven diffusion of these grassroots networks on the one hand challenges current narratives on the momentum of grassroots innovations, but on the other highlights important issues in the geography of grassroots innovations for sustainability, such as cross-movement transfers and collaborations, institutional thickness, and interplay of different proximities in grassroots innovation diffusion.

A business model for an inclusive entrepreneurial development

In 2004 Prahalad made managers aware of the great economic opportunity that the population at the BoP (Base of the Pyramid) represents for business in the form of new potential consumers. However, MNCs (Multi-National Corporations) generally continue to penetrate low income markets with the same strategies used at the top of the pyramid or choose not to invest at all in these regions because intimidated by having to re-envision their business models. The introduction of not re-arranged business models and products into developing countries has done nothing more over the years than induce new needs and develop new dependencies. By conducting a critical review of the literature this paper investigates and compares innovative approaches to operate in developing markets, which depart from the usual Corporate Social Responsibility marketing rhetoric, and rather consider the potential consumer at the BoP as a ring of continuity in the value chain − a resource that can itself produce value. Based on the concept of social embeddedness (London & Hart, 2004) and the principle that an open system contemplates different provisions (i.e. MNCs bring processes and technology, NGOs cultural mediating skills, governments laws and regulations, native people know-how and traditions), this paper concludes with a new business model reference that empowers all actors to contribute to value creation, while allowing MNCs to support local growth by turning what Prahalad called ‘inclusive capitalism’ into a more sustainable ‘inclusive entrepreneurial development’.

Can GRI light up the future of mankind?

There is strong evidence across the media that humanity has finally come to recognize the certainty and imminence of a global environmental crisis due to man-triggered ecological alterations. This widespread recognition of what is happening around us has matured even further as studies acknowledging that everything on Earth is interconnected begin to mount across various branches of learning. The appreciation of this simple linear and two-dimensional relationship implies enormous consequences for economic and management studies, as alternative business models will eventually have to supersede the old practices that still govern major industry sectors (e.g. energy, cement, agriculture, automotive, pharmaceutical, etc.). This paper argues that traditional knowledge found in developing countries can sometimes harness the potential of sparking genuine alternatives to established business practices. With a focus on the most fundamental geochemical cycles on Earth − nitrogen, water, and carbon − and the primary resources they govern (soil, water, and air), three case studies are presented to illustrate how traditional knowledge in the context of GRI (Grassroots Innovation) projects can lead to challenge the dominant logic, when allowed to thrive in terms of adoption and scalability.

Renegades on the frontier of innovation: The shanzhai grassroots communities of Shenzhen in China's creative economy

Two Australian researchers specializing in China's creative industries examine recent developments in southern China commonly associated with the shanzhai phenomenon (e.g., production and sale of cheap local facsimiles of globally branded goods). While shanzhai is often condemned as the embodiment of China's "knock-off" industries, the authors argue that it might be more appropriately viewed as an instance of China's emerging creative economy and an example of rapid prototyping. The paper traces the evolution of shanzhai mobile phones and the materialization of the shanzhai ethos in popular culture. In arguing that shanzhai provides inputs into creative industries, the paper describes the fuzzy boundary between formal and informal culture and notes the interaction between three spheres of activity: official culture, the market, and grassroots culture.

Institutions, Innovation, and Grassroots Change: Alternatives to Transnational Governance in the Global South

Transnational governance has been advanced as a viable option for regulating commodities produced in emerging economies—where incapable or unwilling states may undersupply institutions requisite for overseeing supply chains consistent with the quality, safety, environmental, or social standards demanded by the global marketplace. Producers from these jurisdictions, otherwise left with few venues for securing market access and price premiums, ostensibly benefit from whatever pathways transnational actors offer to minimize barriers to entry—including voluntary certification for compliance with a panoply of public and private rules, such as those promulgated by NGOs like the Fair Trade Federation or multinational retailers like Wal-Mart. Yet, such transnational “sustainability” governance may neither be effective nor desirable. Regulatory schemes, like third-party certification, often privilege the interests of primary architects and beneficiaries—private business associations, governments, NGOs, and consumers in the global North—over regulatory targets—producers in the global South. Rather than engaging with the international marketplace via imported and externally-driven schemes, some producer groups are instead challenging existing rules and innovating homegrown institutions. These alternatives to commercialization adopt some institutional characteristics of their transnational counterparts yet deliver benefits in a manner more aligned with the needs of producers. Drawing on original empirical cases from Nicaragua and Mexico, this dissertation examines the role of domestic institutional alternatives to transnational governance in enhancing market access, environmental quality and rural livelihoods within producer communities. Unlike the more technocratic and expert-driven approaches characteristic of mainstream governance efforts, these local regulatory institutions build upon the social capital, indigenous identity, “ancestral” knowledge, and human assets of producer communities as new sources of power and legitimacy in governing agricultural commodities.

Mobiles In-a-Box : Reflections on Developing a Toolkit with Grassroots Human Rights Advocates

In 2008 Tactical Tech published 'Mobiles in-a-box': a toolkit designed to help human rights organisations and advocates use mobile technology in their work in Africa. This chapter reflects on the participatory development process used to develop the toolkit.

Envisaging change: Supporting grassroots efforts in Colombia with agonistic design processes

Design has become increasingly engaged with bringing about social change. Shifting domains and perspectives to conflict stricken contexts yield opportunities to explore emerging forms of design that enable the expression and articulation of difference in productive ways, which can contribute positively to efforts related to civic issues and struggles in urban settings from developing countries. We explore the recently developed notion of Adversarial Design to support the integration of diverging perspectives and grassroots voices in the design process. This paper presents the findings and design insights from our study with two grassroots organisations in Bogota, Colombia. We present three themes that expose ways in which conflict motivates bringing about change, the importance of the social and physical features of the urban landscape, and the way in which social change acts as catalyst for acquiring new knowledge. To finalise, we discuss two design areas and how design could be used to integrate dissimilar worldviews.

Identifying opportunity spaces for design research in South America: Working with grassroots and community groups

As design research continues to gain momentum in South America, design researchers and practitioners in the region have begun to consider how to the field may address regionally-specific issues, including on-going political struggles. By bringing approaches such as Participatory Design and Adversarial Design that consider political aspects of design, local researchers have explored various forms that these two approaches could take that are tailored to the needs and values of different communities across the region. This paper focuses on identifying opportunities for developing design research projects in community-based and grassroots-oriented contexts. The paper presents the findings of our study about the understanding and experience of design researchers and experts who have been working closely with community groups and grassroots organisations in South America. Five themes emerged, highlighting opportunities and challenges related to positioning contemporary design research in the region, integration of adversarial perspectives into design processes, leveraging local obstacles through creativity, and the potential of building capacity within community groups and grassroots organisations for sustainability and autonomy.

Narratives of grassroots innovations: a comparison of voluntary simplicity and the transition movement in Italy

Grassroots innovations (GI) are promising examples of deliberate transformation of socio-technical systems towards resilience and sustainability. However, evidence is needed on the factors that limit or enable their success. This paper set out to study how GI use narratives to empower innovation in the face of incumbent socio-technical regimes. Institutional documents were comparatively analyzed to assess how the narratives influence the structure, form of action and external interactions of two Italian grassroots networks, Bilanci di Giustizia and Transition Network Italy. The paper finds an internal consistency between narratives and strategies for each of the two networks. The paper also highlights core similarities, but also significant differences in the ethical basis of the two narratives, and in the organizations and strategies. Such differences determine different forms of innovation empowerment and expose the niche to different potentials to transform incumbent regimes, or to the risk of being co-opted by them.

The sustainability revolution : A societal paradigm shift - ethos, innovation, government transformation

The Sustainability revolution: A societal paradigm shift – ethos, innovation, governance transformation This paper identifies several key mechanisms that underlie major paradigm shifts. After identifying four such mechanisms, the article focuses on one type of transformation which has a prominent place in the sustainability revolution that the article argues is now taking place. The transformation is piecemeal, incremental, diffuse – in earlier writings referred to as ”organic”. This is a more encompassing notion than grassroots, since the innovation and transformation processes may be launched and developed at multiple levels through diverse mechanisms of discovery and development. Major features of the sustainability revolution are identified and comparisons made to the industrial revolution.

Crafting Sustainable Development Solutions: Frugal Innovations of Grassroots Entrepreneurs

A shift in the entrepreneurial landscape is taking place brought about by grassroots innovators with little formal education and technological knowhow, living and working in penurious environments. This research represents an emerging third wave of literature on Bottom of the Pyramid innovation, where products are offered for and by the underserved. Using primary and secondary data derived from four cases of grassroots entrepreneurs in the Indian Subcontinent, the study explores the phenomenon where resource scarce entrepreneurs craft solutions that are environmental friendly, with low overall ownership costs, and use locally available material. We argue that the grassroots phenomenon can be fruitfully exploited to achieve the new Sustainable Development Goals proposed by the UN as a post-2015 strategy for the future of global governance. These innovations might have a tremendous impact not only in terms of serving unmet and ignored consumer needs, but also longer term impacts through enhanced productivity, sustainability, poverty reduction and inclusion promotion.