Small and medium‐sized enterprises (SMEs) in emerging economies encounter various challenges when it comes to adopting circular economy (CE) principles due to their resource‐constrained contexts. Consequently, they often rely on innovation to facilitate the implementation of these principles. In this study, we explore the effect of source of innovation, generation or adoption, on the implementation of CE principles within SMEs in emerging economies. We also go one step further and examine the mechanism through which the source of innovation affects the implementation of CE principles. We argue that in resource‐constrained contexts, firm may use frugal innovation as a mediator in the relationship between the source of innovation and the implementation of CE principles. We collected 306 survey responses from SMEs in India and Pakistan and analyzed the data through PLS‐SEM using SMARTPLS4 software. The findings indicate that both innovation generation and innovation adoption have a positive effect on implementing CE principles, with innovation adoption showing the most significant effect. Additionally, we discovered that frugal innovation plays a partial mediator role in the relationship between innovation generation/innovation adoption and implementing CE principles. These results suggest that SMEs in emerging economies can leverage both innovation generation and adoption to advance the adoption of CE principles, fostering the development of frugal innovations in the process, which further drive the implementation of CE principles. Moreover, our findings contribute to the ongoing research debate regarding the relationship between frugal innovation and sustainability, highlighting the impact of frugal innovation on environmental sustainability.

中文翻译：

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弥合新兴经济体中小企业创新源泉与循环经济原则实施之间的差距：节俭创新的中介作用


由于资源受限，新兴经济体的中小企业 （SME） 在采用循环经济 （CE） 原则时遇到了各种挑战。因此，他们通常依靠创新来促进这些原则的实施。在这项研究中，我们探讨了创新来源、产生或采用对新兴经济体中小企业实施 CE 原则的影响。我们还更进一步，研究了创新来源影响 CE 原则实施的机制。我们认为，在资源受限的情况下，公司可以使用节俭创新作为创新源泉与 CE 原则实施之间关系的中介。我们收集了来自印度和巴基斯坦中小企业的 306 份调查回复，并使用 SMARTPLS4 软件通过 PLS-SEM 分析了数据。研究结果表明，创新产生和创新采用都对实施 CE 原则有积极影响，其中创新采用显示出最显着的影响。此外，我们发现节俭创新在创新产生/创新采用与实施 CE 原则之间的关系中起部分中介作用。这些结果表明，新兴经济体的中小企业可以利用创新产生和采用来推动 CE 原则的采用，在此过程中促进节俭创新的发展，从而进一步推动 CE 原则的实施。此外，我们的研究结果有助于正在进行的关于节俭创新与可持续性之间关系的研究辩论，突出了节俭创新对环境可持续性的影响。