2026 General Seminar - Tim Cason (Purdue)

Title: Early Innovation Adoption and Information Free-Riding: An Experimental Investigation

by Tim Cason

Abstract:  We study information free-riding in a dynamic collective experimentation setting common during innovation adoption. In theory, limiting future access to the innovation reduces the relative benefit to free-riding. To encourage the most experimentation, the optimal amount of access balances the trade-off between too much access that leads to information free-riding and too little access that limits learning. We report a controlled lab experiment that varies future access to the innovation to test several theoretical predictions. Results show that human subjects respond to variation in the future access as predicted; however, the magnitude of their response is insufficient to generate the overall benefit of the intervention. We explore how individual characteristics such as loss aversion, cognitive ability, and ability to update beliefs optimally impact individuals’ decisions to information free-ride.