Creative Production and Exchange of IdeasIryna Sikora2015 Papers from Job Market PapersAbstract: This paper explores how exposure to the ideas of others is embraced in creative-process technology. We report evidence from a two-stage real-effort lab experiment, in which subjects perform creative idea-generation tasks. In the Â first stage, we control whether the output of other players is observed; this design allows us to quantify the effect of new ideas on creative productivity. In the second stage, we make ideas costly and elicit the subject’s Âwillingness to pay for them. We characterize investment behaviour in this creative environment by comparing expected monetary beneÂ ts from increased productivity to the cost of exposure. Our results show that observing output of others boosts productivity in creative tasks, but only when it discloses previously unknown items and the output of low creative-ability players is not found to be benefiÂ cial. When ideas become costly, subjects do not act in a proÂ t-maximizing way. We fiÂ nd that they pursue lower costs and systematically overinvest in output of less creative players. This effect is more pronounced for females, risk-averse, more self-confident subjects and those of lower creative ability. As ideas of less creative participants are rarely original, this behaviour does not lead to the highest possible level of creative production in aggregate.