Secondhand social capital and idea quality in open innovation communities

Abstract

Open innovation communities provide valuable opportunities for creators from diverse backgrounds to collaboratively generate and refine new ideas that companies can implement in new products or services. However, many submitted ideas in these communities are underdeveloped or misaligned with companies' expectations, raising questions about what drives high-quality ideas and, more specifically, innovation potential. We focus on the role of secondhand social capital, i.e., the indirect network benefits an idea accrues through feedback from providers who are themselves actively engaged with other influential ideas in the community. While prior research has explored ego-centric or first-hand networks, we extend this work by examining how an idea's position within feedback networks shapes its elaboration and innovation potential. We argue that feedback from highly connected feedback providers confers greater visibility, legitimacy, and alignment with community expectations, thereby enhancing the quality of an idea. Using data from an open innovation platform for vehicle design, we find that secondhand social capital significantly predicts higher-quality ideas. By contrast, traditional measures of network constraint (e.g., closure, structural holes) are not consistently and significantly associated with idea quality. Further, our analysis suggests that when feedback is constructive and encouraging, the effect of secondhand social capital is stronger. Our findings contribute to theory by identifying secondhand social capital as a key mechanism linking network structure and idea quality. More broadly, this research bridges micro-level creativity and macro-level innovation literatures by emphasizing feedback through secondhand social capital as a linchpin connecting idea generation and implementation in decentralized, collaborative environments.