Creativity Under Fire: The Effects of Competition on Creative Production
70 Pages Posted: 8 Nov 2014 Last revised: 7 Feb 2019
Date Written: September 10, 2018
Though fundamental to innovation and essential to many industries and occupations, individual creativity has received limited attention as an economic behavior and has historically proven difficult to study. This paper studies the incentive effects of competition on individuals' creative production. Using a sample of commercial logo design competitions, and a novel, content-based measure of originality, I find that intensifying competition induces agents to produce original, untested ideas over tweaking their earlier work, but heavy competition drives them to stop investing altogether. The results yield lessons for the management of creative workers and for the implementation of competitive procurement mechanisms for innovation.
Keywords: Creativity; Incentives; Tournaments; Competition; Radical vs. Incremental Innovation
JEL Classification: D81, M52, M55, O31, O32
Suggested Citation: Suggested Citation