An experimental study on the effect of knowledge on idea generation and idea selection

Bernd Irlenbusch, Katharina Laske, Marina Schröder and Rika Stoczek

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: How firms generate and select ideas influences their strategic path and the development of entire industries. To better understand this process, we experimentally analyze the impact of knowledge on idea generation and selection in an incentivized ideation task. Between treatments, we vary whether or not ideators are provided with examples of previous successful ideas before working on the task. We provide causal evidence that knowledge about such example ideas leads to path dependencies, i.e., knowledge increases the similarity of new ideas to those provided. Consistent with the hypothesis that knowledge affects the search for new ideas, we find evidence of path dependencies during idea generation, but do not find statistically significant evidence of additional path dependencies during idea selection. Overall, when knowledge is provided, we observe an increase in selected innovative ideas that are similar to previous ideas and a decrease in selected innovative ideas that are different from previous ideas.

Keywords: idea generation; idea selection; innovation; knowledge; path dependency; real-effort experiment (search for similar items in EconPapers)
JEL-codes: J01 J50 R14 (search for similar items in EconPapers)
Date: 2026-09-28
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Published in International Journal of Industrial Organization, 28, September, 2026, 109. ISSN: 0167-7187

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