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Mirage at the Bottom of the Pyramid

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  • Aneel Karnani

Abstract

Poor people ??? at the bottom of the pyramid (BOP) ??? represent a very attractive market opportunity. The ???BOP proposition??? argues that selling to the poor can simultaneously be profitable and help eradicate poverty. This is at best a harmless illusion and potentially a dangerous delusion. This paper shows that the BOP argument is riddled with fallacies, and proposes an alternative perspective on how the private sector can help alleviate poverty. Rather than focusing on the poor as consumers, we need to view the poor as producers. The only way to alleviate poverty is to raise the real income of the poor.

Suggested Citation

  • Aneel Karnani, 2006. "Mirage at the Bottom of the Pyramid," William Davidson Institute Working Papers Series wp835, William Davidson Institute at the University of Michigan.
    • Handle: RePEc:wdi:papers:2006-835
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    References listed on IDEAS

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    Cited by:

    1. Sjauw-Koen-Fa, August R. & Blok, Vincent & Omta, S.W.F. (Onno), 2016. "Critical Success Factors for Smallholder Inclusion in High Value-Adding Supply Chains by Food & Agribusiness Multinational Enterprise," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 19(1), pages 1-30, February.
    2. René Díaz-Pichardo & Patricia S. Sánchez-Medina & Consuelo García De La Torre, 2017. "Explaining Inequality Within The Bop: Urban Vs. Rural," Journal of Developmental Entrepreneurship (JDE), World Scientific Publishing Co. Pte. Ltd., vol. 22(03), pages 1-17, September.
    3. Oetzel, Jennifer & Doh, Jonathan P., 2009. "MNEs and development: a review and reconceptualization," Journal of World Business, Elsevier, vol. 44(2), pages 108-120, April.
    4. Mario César Dávila-Aguirre & Lisa M. Hanley & Gerardo Lozano-Fernández & Thomas S. Lyons, 2014. "Leveraging low income farmers’ performance through empowerment: Analysis of a sustainable initiative in Mexico," Management & Marketing, Economic Publishing House, vol. 9(2), Summer.
    5. Barendrecht, J.M. & van Nispen, P., 2008. "Microjustice," Discussion Paper 2008-010, Tilburg University, Tilburg Law and Economic Center.
    6. Sophie Hooge & Kevin Levillain & Ludivine Guérineau & Anne Bion-Robin & Julie Gautier, 2016. "Designing exploratory partnerships in Southeast Asia: The challenge of building a sustainable ecosystem to address chronic malnutrition," Post-Print hal-01364198, HAL.
    7. Mukul Asher, 2006. "India’s Rising Role in Asia," Working Papers id:727, eSocialSciences.
    8. Volkert Jürgen, 2009. "Unternehmen als Agenten der Armutsüberwindung und Entwicklung. Ihr Beitrag aus Sicht von Ordoliberalismus und Capability-Ansatz / Corporate potentials to fight poverty and foster human development. Or," ORDO. Jahrbuch für die Ordnung von Wirtschaft und Gesellschaft, De Gruyter, vol. 60(1), pages 389-414, January.
    9. Jean-Louis Warnholz (QEH), "undated". "Poverty Reduction for Profit? A Critical Examination of Business Opportunities at the Bottom of the Pyramid," QEH Working Papers qehwps160, Queen Elizabeth House, University of Oxford.
    10. Michael D. van der Merwe & Sara S. Grobbelaar & Cornelius S. L. Schutte & Konrad H. von Leipzig, 2018. "Toward an Enterprise Growth Framework for Entering the Base of the Pyramid Market: A Systematic Review," International Journal of Innovation and Technology Management (IJITM), World Scientific Publishing Co. Pte. Ltd., vol. 15(04), pages 1-34, August.
    11. Lauri Erik Lehikoinen & Amanda Lundh & Louis Meert & Kevan Waeingnier & Nina Bentsen & Ida B. T. Norbye, 2017. "Innovation and Creativity at the Bottom of the Pyramid," International Journal of Business and Economic Sciences Applied Research (IJBESAR), International Hellenic University (IHU), Kavala Campus, Greece (formerly Eastern Macedonia and Thrace Institute of Technology - EMaTTech), vol. 11(1), pages 13-25, December.
    12. Spagnoletti, Belinda & O’Callaghan, Terry, 2013. "Let there be light: A multi-actor approach to alleviating energy poverty in Asia," Energy Policy, Elsevier, vol. 63(C), pages 738-746.
    13. Sjauw-Koen-Fa, August R. & Omta, S.W.F. (Onno) & Blok, Vincent, 2018. "Constructing a Multinationals’ Inclusive Sourcing Indicator for Impacting Farmer Business Models: Application in Cocoa Cases," International Journal on Food System Dynamics, International Center for Management, Communication, and Research, vol. 9(3), June.

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    More about this item

    Keywords

    Poverty; Bottom of the pyramid; Selling to the poor; social responsibility;
    All these keywords.

    JEL classification:

    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
    • M10 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - General

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