The Conceptual Model Of Crowd Innovation And Game Theory Analysis On Crowd Innovation Contest

The coming of knowledge economy broke the original model of information transmission and is changing the competition environment of enterprises. Enterprises have to develop competing superiority by continuous innovation. Innovation is facing a process from closed to open. The popularization of internet and the application of mobile internet generate the innovation Web2.0model and are maturing the innovation democratization. Practices indicate the crowd innovation has become a new innovation pattern, with the maturing of internet and mobile internet. However, this new innovation pattern based on internet has not caused enough attention. This paper describes the evolution from traditional innovation patterns to the crowd innovation pattern. Objected to crowd innovation, comprehensive research methods including document research, case study, comparative analysis and game theory have been used to construct the concept model of internet-based crowd innovation. Based on the auction theory, game mechanism between the partners in a crowd innovation contest is studied. Specifically, the content of this paper can be concluded into two main parts:First, this paper puts forward the concept model of crowd innovation innovatively. Crowd innovation is an internet-based innovating pattern where the innovators perform their innovation via various internet platforms built by enterprises or individuals, and/or reveal or sell their innovating achievements via the internet; and where other enterprises or individuals (demanders) source, acquire and utilize the innovating achievements via the internet. There are three implications of crowd innovation:the crowd innovation motivations exist comprehensively; the chances of crowd innovation equalize to a great extent; the crowd innovating capacity improves sustainably. A three-stage "C-D-M" model has been constructed centering on the internet. It also analyzes two practical cases:Innocentive and App Store.Second, this paper studies the game mechanism between participates in a crowd innovation contest. Via transformation, the all-pay auction model is used to reflect this model, considering a single sponsor, multiple participators and a single stage game. Under the "M-H" motivation condition, we can solve out the balanced endeavor level of innovation participators. The result shows that:There exists at least one pure strategy Nash equilibrium solution for this model that fulfills the private value model; those participates with higher skills tend to pay more effort during the contest; compared with traditional innovation activities, crowd innovation contest can transfer innovation risk from enterprises to crowd individuals and at the same time reduce the innovation cost.