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“Open” disclosure of innovations, incentives and follow-on reuse: Theory on processes of cumulative innovation and a field experiment in computational biology

December 06, 2016 by Kevin J. Boudreaua, Karim R. Lakhani

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Most of society's innovation systems – academic science, the patent system, open source, etc. – are “open” in the sense that they are designed to facilitate knowledge disclosure among innovators. An essential difference across innovation systems is whether disclosure is of intermediate progress and solutions or of completed innovations. We theorize and present experimental evidence linking intermediate versus final disclosure to an ‘incentives-versus-reuse’ tradeoff and to a transformation of the innovation search process. We find intermediate disclosure has the advantage of efficiently steering development towards improving existing solution approaches, but also has the effect of limiting experimentation and narrowing technological search. We discuss the comparative advantages of intermediate versus final disclosure policies in fostering innovation.