Monetary Incentives and Knowledge Spillover: Evidence from a Natural Experiment

We examine how the introduction of monetary incentives by a knowledge-sharing platform affects nonrewarded knowledge activity on platform. Our setting is question-and-answer that provides for holding live talks. Using combination coarsened exact matching and difference-in-differences estimation techniques, we find launch paid feature creates positive spillover effect hosts’ free contributions, specifically, 9.4%–40.8% more answers in short run when compared with nonhosts. The did not result any significant change quality answers. suggest reputation building one plausible mechanism underlying spillover. Additional analyses reveal negative short-lived hosts long run, indicating possible crowding out contributions. long-lived lasts longer but also reduced over time. findings introducing can be viable business model platforms to stimulate user contributions both related unpaid activities. Yet owners should cautious about potential after users stop contributing develop effective strategies maintain users’ long-term interests program. This paper was accepted Kartik Hosanagar, information systems.