Performance Feedback in Competitive Product Development

Daniel Gross

No 16-110, Harvard Business School Working Papers from Harvard Business School

Abstract: Performance feedback is ubiquitous in competitive settings where new products are developed. This article introduces a fundamental tension between incentives and improvement in the provision of feedback. Using a sample of four thousand commercial logo design tournaments, I show that feedback reduces participation but improves the quality of subsequent submissions, with an ambiguous effect on high-quality output. To evaluate this tradeoff, I develop a procedure to estimate agents' effort costs and simulate counterfactuals under alternative feedback policies. The results suggest that feedback on net increases the number of high-quality ideas produced and is thus desirable for a principal seeking innovation.

Keywords: Feedback; Evaluation; Learning; Tournaments; Innovation (search for similar items in EconPapers)
JEL-codes: C51 C57 D82 D83 M55 O31 O32 (search for similar items in EconPapers)
Pages: 72 pages
Date: 2016-03, Revised 2016-10
New Economics Papers: this item is included in nep-ino
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Journal Article: Performance feedback in competitive product development (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:hbs:wpaper:16-110

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