Innovation Policy and the Economy, Volume 11

still be noteworthy, and individual leadership can be critical to effective team function,
rewarding individuals at the expense of teams appears increasingly in tension with the nature of
science itself. First, privileging individual rewards creates disincentives to engage in teamwork
in the first place, giving individuals reason to horde ideas and avoid partnerships that would
enhance the research but dilute credit. Second, in choosing partners, individuals are encouraged
to select partners partly based on ex-post credit considerations rather than effectiveness of the
research team.²⁰ Third, researchers end up battling over credit ex-post if the project turns out
well, as team members jockey for individual rewards. From this perspective, shifting toward high
status and/or financial reward “team prizes” for particular innovations could help undo the
incentive challenges that individual rewards impose.

B. Idea Evaluation

The evaluation of ideas matters on two levels. First, given some set of ideas, evaluation
matters directly for creating well-defined intellectual property rights and for selecting research
lines with high expected payoffs. Second, evaluation expectations affect innovative effort itself.
Innovators may choose and/or shape projects that appeal to biases in the evaluative mechanism
(affecting the direction of creative activity) and may be dissuaded from innovative effort
generally (affecting the rate of creative activity) if the evaluation mechanism is seen as especially
noisy.

Because expertise is necessarily limited, evaluation is necessarily challenging. Indeed,
how can a single individual evaluate aspects of a patent application or research proposal that sit
outside that individual’s own expertise? Relying on guesswork will result in error-prone
decisions. Relying on a bias against the unknown will privilege narrow ideas. An intuitive
response to the increasing teamwork in idea production is to increase teamwork in idea
evaluation, engaging multiple individuals that aggregate the necessary expertise. Bringing the
relevant evaluative team to bear can increase evaluative accuracy.

²⁰ This point is an application of the Matthew Effect in science (Merton 1968), which becomes increasingly salient
as teamwork becomes increasingly important.

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