Re-Use and Patterns of Digital Innovation in Open Crowds

44 Pages Posted: 3 Feb 2017 Last revised: 8 Feb 2017

Sabine Brunswicker

Purdue University - Research Center for Open Digital Innovation (RCODI); Purdue University - Discovery Park

Michael Prietula

Emory University - Goizueta Business School

Date Written: January 30, 2017

Abstract

This paper examines reuse patterns in transparent multi-staged contests, in which a crowd of developers can reuse others’ designs when developing a novel digital application. They compete for the best application, one that is of high quality in both code and feature. Transparency, defined as collective information access to (1) the design solution, and (2) and the quality of it, triggers variability in reuse choices. Depending on the relative performance, developers adapt their risk preference along a continuum of exploitative to explorative reuse. However, variability in reuse behavior is also shaped by an individuals’ design preference: to focus on either code or feature. To explore patterns of reuse and performance emerging from this micro-level heterogeneity, we develop an agent-based simulation model, informed by theory of reuse and variable risk preferences, as well as emerging empirical data. Our results reveal unexpected discontinuous performance patterns. Design preferences, a bias towards code or feature, lowers the collective performance of the crowd. However, transparency insulates those at the top from such negative effects. It produces high performing designs even if there is bias. Further, while transparency reduces variability and smooths the patterns among those at the top, it also creates unique opportunities for ‘newcomers’ to submit high-quality applications.

Keywords: open crowds, contest, transparency, reuse, agent-based modeling, digital innovation, variable risk preferences

JEL Classification: D83

Suggested Citation

Brunswicker, Sabine and Prietula, Michael, Re-Use and Patterns of Digital Innovation in Open Crowds (January 30, 2017). Available at SSRN: https://ssrn.com/abstract=2908650 or http://dx.doi.org/10.2139/ssrn.2908650

Sabine Brunswicker (Contact Author)

Purdue University - Research Center for Open Digital Innovation (RCODI) ( email )

516 Northwestern Ave
West-Lafayette, IN 47906
United States

HOME PAGE: http://www.purdue.edu/opendigital

Purdue University - Discovery Park ( email )

United States

Michael Prietula

Emory University - Goizueta Business School ( email )

1300 Clifton Road
Atlanta, GA 30322-2722
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
60
rank
328,593
Abstract Views
349
PlumX