Upgrading under scarcity: innovation practices and local agency in the cashew chain in Guinea-Bissau

Purpose This article aims to investigate how upgrading practices, understood as value-adding strategies through innovations in products, processes, functions and intersectoral articulation, are operationalized in the cashew production chain in Guinea-Bissau, a low-income country characterized by structural scarcity and institutional fragility. By integrating insights from global value chains (GVCs), frugal innovation and institutional entrepreneurship, the study explores how local actors develop context-specific upgrading practices. The article introduces the notion of “upgrading under scarcity” to describe hybrid, informal and adaptive strategies of value creation that reflect the constraints and agency dynamics in marginal environments. Design/methodology/approach This study employs a qualitative approach, combining an integrative literature review, document analysis and semi-structured interviews with local actors involved in the cashew value chain in Guinea-Bissau. The methodology is grounded in the analysis of upgrading practices as they unfold in settings characterized by structural informality, low institutional density and limited access to resources. An analytical framework structured around four dimensions – product, process, functional and intersectoral upgrading – guides the empirical investigation and supports the identification of context-specific strategies shaped by local agency and material constraints. Findings The findings identify a set of upgrading practices that emerge in fragmented and adaptive ways within the cashew value chain in Guinea-Bissau, shaped by structural scarcity and informal institutional environments. These include partial adoption of organic and fair-trade certification, selective automation of processing stages, use of by-products for energy generation, small-scale diversification of cashew derivatives and horizontal cooperation among cooperatives. Rather than following linear or technology-intensive trajectories, these practices reflect pragmatic responses to local constraints and conditions. Originality/value This study contributes to the literature by integrating insights from GVCs, frugal innovation and institutional entrepreneurship to examine productive upgrading in a low-income African context. By focusing on practices shaped by informality, limited resources and weak institutional support, it offers a situated perspective on how value is added under structural constraints. The notion of “upgrading under scarcity” offers an analytical lens for exploring alternative trajectories of transformation in peripheral economies without assuming alignment with dominant development models. The study also offers insights for policy discussions on supporting context-sensitive and locally grounded productive initiatives.