Make bricks without straw: Eco-innovation for resource-constrained firms in emerging markets

Abstract

Whereas in prior literature resource sufficiency was viewed as a precondition for eco-innovation, this study explores the ways in which resource-constrained firms in emerging markets promote eco-innovation. We argue that entrepreneurial bricolage, the repurposing of resources at hand, can empower resource-constrained firms to solve problems related to eco-innovation in emerging markets. Entrepreneurial bricolage theory provides the foundation for our hypothesis that the primary outcomes of entrepreneurial bricolage are institutional leverage capability (resource mobilization) and compositional capability (resource integration), which in turn affect eco-product, eco-process, and eco-management innovation. Based on the findings of a survey of 412 firms in the year 2016 in China, we test the postulated model using partial least squares structural equation modeling. The results show that entrepreneurial bricolage drives eco-process and eco-product innovation mainly through compositional capability, but drives eco-management innovation through both compositional capability and institutional leverage capability. This is the first attempt to explore the role of entrepreneurial bricolage in the eco-innovation of resource-constrained firms, and its findings provide recommendations for enhancing firm-specific capabilities to facilitate eco-innovation in emerging markets.