The Impact of Cooperation in Innovation Contests: Poison Pill, Placebo, or Tonic?

Recent applications of crowdsourcing integrate structures where contestants compete against each other, yet are also allowed to see and comment on others’ contributions. While literature on knowledge recombination in cooperation and competition on problem-solving is ample, the interplay is not. Whether or not allowing for cooperation under competition is a poison pill, placebo, or tonic for idea generation performance remains a puzzle. We explore this interplay and investigate further boundary conditions that influence the outcomes of these relationships. Evidence from a lab experiment with 294 individuals and qualitative coding of the cooperation processes suggests that letting participants cooperate causes mixed effects. The overall innovativeness, novelty, and usefulness of the submitted ideas do not increase through cooperation. However, cooperation has a negative effect on idea feasibility. The results also show that cooperation under low competition increases the benefit a solution offers to users. Content analysis of the cooperation process reveals that participants are influenced by both the feedback comments and the ability to see others’ ideas, but mostly depend on feedback comments that offered no substantially new knowledge when revising ideas. Our results contribute to a better theoretical understanding of cooperation under competition in crowdsourcing contests.