Abstract
We analyze frugality-based advantage and explain its types and implications. Frugality-based advantage is an advantage that a firm achieves over competitors in its ability to develop and use frugal innovations, that is, innovations that overcome external resource constraints. We differentiate among three types of frugality-based advantages based on the external constraints they solve: (1) Input frugality-based advantage, which is the result of addressing restrictions in the provision of inputs needed for the production process; (2) Income frugality-based advantage, which is driven by solving limitations in the income of consumers; and (3) Infrastructure frugality-based advantage, which is the outcome of resolving constraints in the hard and soft infrastructure of the country. We explain how these three types of frugality-based advantages differ in their transferability across locations and their sustainability across time. Frugality-based advantage complements the resource-based view by explaining how the scarcity of external resources, rather than their abundance, can support the advantage of some firms.
| Original language | English |
|---|---|
| Journal | Long Range Planning |
| DOIs | |
| Publication status | Published - 2019 Jan 1 |
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Keywords
- Competitive advantage
- Constraints
- Frugal
- Innovation
- Resource-based view
ASJC Scopus subject areas
- Geography, Planning and Development
- Finance
- Strategy and Management
Cite this
Frugality-based advantage. / Asakawa, Kazuhiro; Cuervo-Cazurra, Alvaro; Annique Un, C.
In: Long Range Planning, 01.01.2019.Research output: Contribution to journal › Article
}
TY - JOUR
T1 - Frugality-based advantage
AU - Asakawa, Kazuhiro
AU - Cuervo-Cazurra, Alvaro
AU - Annique Un, C.
PY - 2019/1/1
Y1 - 2019/1/1
N2 - We analyze frugality-based advantage and explain its types and implications. Frugality-based advantage is an advantage that a firm achieves over competitors in its ability to develop and use frugal innovations, that is, innovations that overcome external resource constraints. We differentiate among three types of frugality-based advantages based on the external constraints they solve: (1) Input frugality-based advantage, which is the result of addressing restrictions in the provision of inputs needed for the production process; (2) Income frugality-based advantage, which is driven by solving limitations in the income of consumers; and (3) Infrastructure frugality-based advantage, which is the outcome of resolving constraints in the hard and soft infrastructure of the country. We explain how these three types of frugality-based advantages differ in their transferability across locations and their sustainability across time. Frugality-based advantage complements the resource-based view by explaining how the scarcity of external resources, rather than their abundance, can support the advantage of some firms.
AB - We analyze frugality-based advantage and explain its types and implications. Frugality-based advantage is an advantage that a firm achieves over competitors in its ability to develop and use frugal innovations, that is, innovations that overcome external resource constraints. We differentiate among three types of frugality-based advantages based on the external constraints they solve: (1) Input frugality-based advantage, which is the result of addressing restrictions in the provision of inputs needed for the production process; (2) Income frugality-based advantage, which is driven by solving limitations in the income of consumers; and (3) Infrastructure frugality-based advantage, which is the outcome of resolving constraints in the hard and soft infrastructure of the country. We explain how these three types of frugality-based advantages differ in their transferability across locations and their sustainability across time. Frugality-based advantage complements the resource-based view by explaining how the scarcity of external resources, rather than their abundance, can support the advantage of some firms.
KW - Competitive advantage
KW - Constraints
KW - Frugal
KW - Innovation
KW - Resource-based view
UR - http://www.scopus.com/inward/record.url?scp=85064268505&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=85064268505&partnerID=8YFLogxK
U2 - 10.1016/j.lrp.2019.04.001
DO - 10.1016/j.lrp.2019.04.001
M3 - Article
AN - SCOPUS:85064268505
JO - Long Range Planning
JF - Long Range Planning
SN - 0024-6301
ER -