Final answer:
Frugal innovation refers to the creation of inexpensive products designed for developing markets, balancing cost-reduction with social responsibility and sustainability. It's a strategy that aligns with economic and technological progress while addressing the market's demand and supply dynamics.
Step-by-step explanation:
The socially responsible marketing concept of creating an inexpensive product specifically tailored for developing markets is known as 'frugal innovation.' This strategy focuses on reducing complexity and cost of goods to make them accessible and affordable in markets with lower purchasing power. Fundamental to frugal innovation is the notion that despite offering these products at a lower price, companies can maintain sustainability and meet social responsibilities. Firms leverage economic growth and innovation, often combined with appropriate technology development and regulatory intervention, to build products that align with the necessity to provide basic needs such as food, clothing, and shelter, especially in low-income countries.
Moreover, the discussion around market-oriented economy and the variety it brings, touches upon the idea of product differentiation and whether creating an array of similar goods is beneficial for society. Critics suggest that many resources spent on differentiation could be socially wasteful, while proponents argue that differentiation meets diverse consumer needs. However, the streamlined approach of frugal innovation may offer a balance by providing essential varieties at lower costs. Ultimately, demand and supply are crucial in determining what gets produced, and frugal innovation helps address the 'for whom' it is produced by targeting the needs of consumers in developing economies.