Markets or Patents? A Comparative Study on Incentivising Collective Innovation
Stage: Data collection in progress
Authors: Hassan Andrabi, Peter Bossaerts, Konstantinos Ioannidis, Robert Woods, Nitin Yadan
Abstract: Conventional wisdom suggests that a precondition for innovation is sufficient incentive that the private benefits of innovation will justify the costs incurred by the inventor. Typically, this incentive is established through the acquisition of patents, which allow inventors to monopolise intellectual property for monetary gain. However, this restricts the circulation of new ideas and slows the pace of innovation. With an experiment, we test here the capacity of markets to overcome this shortcoming by incentivising individuals to collectively find solutions to a complex task that mirrors the complexity of producing innovations in the real world.
Presented at: 2nd summer school on Cognitive Foundations of Decision-Making (Ghent, 2025), 2nd Annual Conference of the Network of the UK-Based Experimental and Behavioural Economists (Sheffield, 2025), 15th Society for Experimental Finance Conference (Maastricht, 2025), University of Vienna Behavioral/Experimental Seminar (Vienna, 2024), 14th Society for Experimental Finance Conference (Stavanger, 2024)
