Blockchain, DLT, and Fintech

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Paper Number

2534

Paper Type

Completed

Description

While the benefits of open-source innovations such as the availability of developers with diverse skill sets and accelerated innovation are well-documented, such open boundaries also facilitate copying (forking) the codebase and creating new substitutes, which may compete with the parents for developer attention. Given that the movement of developers across projects is made easier due to lower friction in open innovation models, we study how substitutes created by copying the codebase of a product impact developers’ attention and subsequent innovation using the context of cryptocurrencies. Using a data set on 23 cryptocurrencies from which 17 forked products were created between 2011 and 2018, we find that in spite of lower friction in this setting, such events have a positive attention spillover effect, which attracts new developers and increases participation among the existing developers. Our study provides managerial insights for firms assessing open models for product development.

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Dec 12th, 12:00 AM

Spillovers in Open Innovation: The Case of Cryptocurrencies

While the benefits of open-source innovations such as the availability of developers with diverse skill sets and accelerated innovation are well-documented, such open boundaries also facilitate copying (forking) the codebase and creating new substitutes, which may compete with the parents for developer attention. Given that the movement of developers across projects is made easier due to lower friction in open innovation models, we study how substitutes created by copying the codebase of a product impact developers’ attention and subsequent innovation using the context of cryptocurrencies. Using a data set on 23 cryptocurrencies from which 17 forked products were created between 2011 and 2018, we find that in spite of lower friction in this setting, such events have a positive attention spillover effect, which attracts new developers and increases participation among the existing developers. Our study provides managerial insights for firms assessing open models for product development.

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