Recommended readings (Machine generated): Abernathy, W.J. and Utterback, J.M. (1978), 'Patterns of innovation in … technology', Technology Review, 80 (7), 40-47. -- Chesbrough, H. (2003), Open Innovation: The New Imperative for Creating and … Thrive in the New Innovation Landscape, Boston, MA: Harvard Business School Press. -- Chesbrough, H. (2006b), Open Innovation …

We consider a model of innovation that distinguishes between ideas and innovations. While innovation responds to … incentives, ideas are a scarce resource that provide an exogenous constraint on the rate of innovation. We investigate how the … optimal reward structure is shaped by the scarcity of ideas. Substitute ideas for innovation in the model arrive to random …