As far as I can tell, the effect persists even if one looks at very modest "innovations". Categories like apparel are mostly minor tweaks on well accepted designs/norms. Yet, we find the same effect. I thought this might be limited to only big/radical innovations for exactly the same reasons but as far as I can see in the data, that does not seem to be the case.
The actual research doesn't claim that more/less innovative projects are more/less funded. The use of 2SLS/instrumental variables explicitly rules out unobserved variables (including how innovative the project really is). Hence, the research only makes claims regarding the extent of novelty and usefulness claims and does not speculate on the underlying nature of the project.
The evidence does not support exaggeration. Making novel and useful claims is linked (causally) to much more money being pledged to the project. In fact the effect size is staggering. With exaggeration, the community should discount the project description. But it doesn't.
What is surprising is that if people fund more if you say its novel, and they fund more if you say its useful, why do they fund less if you say its both novel and useful? Why do they respond positively to novel, and positively to useful, and negatively to the joint of these. This effect is stable across categories, across time. It does not seem to be a learning story (backers learn that novel + useful is more risky and hence better not funded). It seems to be something more fundamental about how we as consumers/individuals respond to innovation claims. But the evidence cannot rule out all confounds: the work is more exploratory than confirmatory.
Re: measuring innovation. Arguably this is a more important question. But the extent of innovation depends on a potential backer's knowledge and their own needs. What is new to someone, is not new to another. What is useful to someone, is not new useful to another. This is an active area of research so other methods may help address this issue. But it would be cost prohibitive to do this at scale using archival data.
I am not sure most people are aware of that. Itâ(TM)s also complicated because often the backer knows the creator on a personal level (friend of a Friend, etc.).
I was about to respond to your question with my favorite example. Just prior to posting, I searched for them on the web. They closed down a few months ago! The best examples are likely games (Exploding Kittens comes to mind). M3D is a good example in technology.
My initial expectation was that most Kickstarter projects are moonshots. But they are not. The vast majority of them are quite modest âoeinnovationsâ. A âoenewâ backpack, jacket, wallet, watch etc.
I find it very interesting as to how backers perceive a product/project: as an investment, a donation, or a purchase. You are correct that it may not align with what it âoeoughtâ to be. There is research on this but not that much is known formally.
More than âoeasking people what they wantâ, this is the equivalent of Steve Jobs walking out and doing a demo of the first iphone and people saying âoeno thanks, I would prefer my horse to your carâ. (With due apologies for mixing up the various metaphors and analogies.)
Our findings hold across the board: if we filter out small projects (for eg., goal less than $10k) or large projects (for eg., goal more than $100k). We originally thought this would be something only for the big, potentially implausible projects. But that doesnâ(TM)t seem to be the case.
Novelty by itself only has curiosity value. Usefulness by itself does not transcend the status quo. Hence, creativity and innovation is their joint.
Our work, unfortunately, canâ(TM)t speak to innovators vs âoepragmatistsâ: a limitation of Kickstarter is that one doesnâ(TM)t really know who is pledging support. It would be interesting to know how innovators differ from early adopters, or how it matters for crossing the chasm (Moore 1991).
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As far as I can tell, the effect persists even if one looks at very modest "innovations". Categories like apparel are mostly minor tweaks on well accepted designs/norms. Yet, we find the same effect. I thought this might be limited to only big/radical innovations for exactly the same reasons but as far as I can see in the data, that does not seem to be the case.
The actual research doesn't claim that more/less innovative projects are more/less funded. The use of 2SLS/instrumental variables explicitly rules out unobserved variables (including how innovative the project really is). Hence, the research only makes claims regarding the extent of novelty and usefulness claims and does not speculate on the underlying nature of the project. The evidence does not support exaggeration. Making novel and useful claims is linked (causally) to much more money being pledged to the project. In fact the effect size is staggering. With exaggeration, the community should discount the project description. But it doesn't. What is surprising is that if people fund more if you say its novel, and they fund more if you say its useful, why do they fund less if you say its both novel and useful? Why do they respond positively to novel, and positively to useful, and negatively to the joint of these. This effect is stable across categories, across time. It does not seem to be a learning story (backers learn that novel + useful is more risky and hence better not funded). It seems to be something more fundamental about how we as consumers/individuals respond to innovation claims. But the evidence cannot rule out all confounds: the work is more exploratory than confirmatory. Re: measuring innovation. Arguably this is a more important question. But the extent of innovation depends on a potential backer's knowledge and their own needs. What is new to someone, is not new to another. What is useful to someone, is not new useful to another. This is an active area of research so other methods may help address this issue. But it would be cost prohibitive to do this at scale using archival data.
I am not sure most people are aware of that. Itâ(TM)s also complicated because often the backer knows the creator on a personal level (friend of a Friend, etc.).
I was about to respond to your question with my favorite example. Just prior to posting, I searched for them on the web. They closed down a few months ago! The best examples are likely games (Exploding Kittens comes to mind). M3D is a good example in technology.
Anyone can support what they prefer. But I think the hope is that people will pick more innovative and more creative projects over other projects.
My initial expectation was that most Kickstarter projects are moonshots. But they are not. The vast majority of them are quite modest âoeinnovationsâ. A âoenewâ backpack, jacket, wallet, watch etc.
I find it very interesting as to how backers perceive a product/project: as an investment, a donation, or a purchase. You are correct that it may not align with what it âoeoughtâ to be. There is research on this but not that much is known formally.
More than âoeasking people what they wantâ, this is the equivalent of Steve Jobs walking out and doing a demo of the first iphone and people saying âoeno thanks, I would prefer my horse to your carâ. (With due apologies for mixing up the various metaphors and analogies.)
It is possible that our findings are driven by skepticism.
Our findings hold across the board: if we filter out small projects (for eg., goal less than $10k) or large projects (for eg., goal more than $100k). We originally thought this would be something only for the big, potentially implausible projects. But that doesnâ(TM)t seem to be the case.
Novelty by itself only has curiosity value. Usefulness by itself does not transcend the status quo. Hence, creativity and innovation is their joint. Our work, unfortunately, canâ(TM)t speak to innovators vs âoepragmatistsâ: a limitation of Kickstarter is that one doesnâ(TM)t really know who is pledging support. It would be interesting to know how innovators differ from early adopters, or how it matters for crossing the chasm (Moore 1991).