Modelling An Innovation Paradigm Shift from Harvard Business School

This paper from Harvard Business School assesses the economic viability of innovation by producers relative to two increasingly important alternative models: innovations by single user individuals or firms, and open collaborative innovation projects. It analyzes the design costs and architectures and communication costs associated with each model. The paper concludes that innovation by individual users and also open collaborative innovation increasingly compete with—and may displace—producer innovation in many parts of the economy. The authors argue that a transition from producer innovation to open single user and open collaborative innovation is desirable in terms of social welfare, and so worthy of support by policymakers.