Grassroots Innovation in Informal Economy and Inclusive Innovation System: Informing Phenomenon

Abstract

Grassroots innovations may result out of completely new or new combinations of hybrids of existing elements with local ingenuity which emphasizes on the ingenious capacity of grassroots innovators to devise innovative solutions by using traditional and indigenous knowledge to solve the problems faced locally by innovator and (or) by community it belongs. These grassroots innovations have emerged as a recent policy tool for inclusive and sustainable economic growth in developing countries because of tremendous potential of such innovations to contribute for sustainable socioeconomic development and poverty alleviation. Despite these, grassroots innovations possess a distinct socioeconomic advantage in the inclusive development process; they are often neglected and kept separate from mainstream innovation support system. In addition, the discrete nature of innovation in the informal setup makes it different from the formal setup and holds the least attention of research scholars. This explorative study finds that, like the conventional innovation in formal sector, pluralism also exists with grassroots innovation in informal sector but both are not exactly similar in nature. This study explored different underlying theories, critical factors, challenges associated with grassroots innovations in informal economy. Further, this paper highlights the distinguishing characteristics of grassroots innovations, development models and theories, institutional engagements, and policy initiatives to promote and support such innovations in Indian context. Finally, the paper suggests a few policy implications to strengthen the grassroots innovation within the inclusive innovation system framework.