Optimal Decisions Of Innovation Crowdsourcing Contests

Internet users have been primarily served as consumers by companies and orga-nizations for business purpose during the past decades.However,with the blossom of social networking media,creation and sharing,all of these elements encourage them to join in the process of economic production in this Web 2.0 era-providing solutions to problems,creating new contents or collaborating in business projects.As a result,new business models have emerged in an endless stream lately in order to use the produc-tivity and creativity of the entire Internet community.Among which,crowdsourcing is becoming one of the most promising leaders.The term "crowdsourcing" was firstly coined by Jeff Howe in the June 2006 issue of Wired magazine.And Howe gave the definition of crowdsourcing,which is "the act of taking a job traditionally performed by a designated agent(usually an employee)and outsourcing it to an undefined,generally large group of people in the form of an open call".Since then,it has taken hold in society remarkably quickly-used to describe the workings of many businesses,used by government entities to describe citizen engage-ment activities,and appearing in thousands of scholarly articles.Lots of literature have discussed crowdsourcing problems through multiple perspectives,such as open innova-tion,collaborative production,network externalities and so on.By investing previous studies,this dissertation aims to make a supplement to the area of crowdsourcing,espe-cially on the aspects of crowdsourcing contest,intermediary fee mechanism and contract management.In a word,based on the new problems arising from Web 2.0 era,this dissertation mainly considered the characteristics of innovative crowdsourcing tasks and optimal decisions among three stakeholders in the crowdsourcing activities.In detail,following research has been done.In Chapter 3,we considered the equilibrium decisions in an innovation crowd-sourcing platform of a single-stage crowdsourcing contest.We formulated a game be-tween three stakeholders in an innovative crowdsourcing platform,comprising the plat-form itself,sponsors,and participants.Using the Stackelberg game and auction theory,we derived the participant's equilibrium effort strategy in a single-prize contest,a two-prize contest,or a multiple-prize contest;we also derived the sponsor's optimal decision for its award mechanism.We proved that the single-prize contest is always preferred by the sponsor.Additionally,we derived the platform's optimal decision under the fixed and proportional intermediary fee schedules and found that the fixed schedule will max-imize the platform's profit.Then,on the basis of Chapter 3,Chapter 4 focused on the optimal reward mech-anism of sponsor with a quality threshold.In other words,we wondered how should the sponsor choose her optimal award mechanism when she had a minimum quality requirement.We still analyzed and discussed the sponsor's optimal strategy under the cases of a single-prize contest,a two-prize contest,and a multi-prize contest-By com-paring some of the main results with part of the conclusions in Chapter 3,we found that the single-prize mechanism is still dominant when the sponsor has a quality threshold.And once there is a certain quality requirement,the sponsor can only obtain a higher expected payoff by increasing her reward.Finally,a multi-stage crowdsourcing contest is generally used to solve relatively complex tasks with lots of dimensions.In the fifth chapter of this dissertation,our re-search interest transferred to a two-stage crowdsourcing contest,which is the simplest form of a multi-stage crowdsourcing contest.By considering two mechanisms:(?)two independent crowdsourcing contests and(?)one crowdsourcing contest plus one com-pensation contract,we analyzed and compared the expected payoff of the company and participants under these two cases.We also conducted numerical analysis of several special cases and gave our management insights.When participants can only get a small share in the compensation contract,his effort level will be low,so the company could gain more from the case of two independent crowdsourcing contests.Besides,as long as the Nash Equilibrium is existed,cooperating with the participant in the second stage will always be the company's dominant strategy.To the best of our knowledge,this dissertation is among the first few studies con-sidering the optimal decisions of stakeholders in a context of innovative crowdsourc-ing task,which would enrich the existing crowdsourcing literature.What's more,our research has a practical significance that will provide a reference for companies and platforms when making their decisions of pricing and service.