Household Innovation : Its Nature, Measurement, Applications, and Outlook

Household innovation is the development of functionally novel products, processes, or other applications by consumers. These are developed in discretionary time without payment. Household innovation is widely present in all economies, but not yet in official statistics. In this chapter we discuss the nature of household innovation and how it differs from innovation in the business sector. Next, we present a survey method to find nation-wide estimates, and give examples of policy insights obtained from household innovation research. In overview, household innovation is driven by self-rewards such as personal use and enjoyment, rather than profit expectations. Household innovations are an important complement to producer-developed innovations. Household innovators tend to pioneer with functionally novel applications. Producers then follow with incremental improvements such as increased reliability, convenience, and energy efficiency. We end with emerging topics in household innovation measurement: behavioral innovations by individuals, and web-scraping methods to collect indicators