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Foreign Direct Investment in R&D and the Base of the Pyramid: Is a new space of innovation emerging in India?”

Chapter in book
Authors Sharmistha Bagchi-Sen
T Schunder
Evangelos Bourelos
Published in McKelvey, M. and Bagchi-Sen, S. (2015). Innovation Spaces in Asia: Entrepreneurs, Multinational Enterprises and Policy
Pages 256-278
ISBN 9781783475674
Publisher Edward Elgar Publishers
Place of publication Cheltenham, U.K.
Publication year 2015
Published at Department of Economy and Society, Innovation and Entrepreneurship (IIE)
Pages 256-278
Language en
Keywords base of pyramid, innovation, India
Subject categories Economics and Business, Other Social Sciences, Technology and social change, Business Administration, Social and Economic Geography, Economic Geography

Abstract

This chapter addresses emerging innovation spaces, driven by new types of customer demand and markets, and specifically new forms of innovations for the poorer segments of the economy. The chapter focuses particularly upon India. Innovations for the poorer segments of the economy has gathered much attention, because a specific characteristic of emerging market economies is that a considerable share of consumers belongs to the bottom (or base) of the pyramid (BOP). Though the individual purchasing power is low, the size of the BOP market segment in sum is enormous taken in aggregate, which makes it an attractive market segment. While these are incentives to access this market segment, companies struggle to deal with the specific market conditions with their traditional business and R&D models. This chapters aims to give an overview on FDI in R&D in emerging markets with a special focus on India and empirical illustrations of innovation strategies and modes of interaction.

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