For most of the last two cen­turies inno­va­tions have flowed from rich coun­tries to poor coun­tries, but in the coming decades we are likely to see inno­va­tions also flow in the oppo­site direc­tion, from poor to rich countries.

If “reverse inno­va­tion” sounds counter-​​intuitive, it is. One can readily under­stand why poor coun­tries will embrace inno­va­tions from rich coun­tries. It is no sur­prise, for instance, that demand is booming in emerging economies for smart­phones, washing machines, cars, and the like.

But why would rich coun­tries want inno­va­tions from poor coun­tries? To focus on one impor­tant reason: there are many more poor people in rich coun­tries than one might expect, and they’re looking for every way to stretch their pur­chasing power.

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