Social Push and the Direction of Innovation

Innovators' personal experience and social networks may affect their familiarity with customer needs, in turn the types of products they bring to market. Consistent this channel, we document that innovators create are more likely be purchased by customers similar them along observable dimensions including gender, age, socio-economic status. With scanner data a new phone applications database, find these homophily patterns hold even within detailed industries. Using quasi-random assignment individuals dorms during military service, provide causal evidence being exposed peers from lower income group increases an entrepreneur's propensity necessity products. We results using alternative research design leveraging idiosyncratic within-school variation peer composition across classes cohorts. Because predominantly men privileged backgrounds, push channel implies gains innovation unequally distributed groups, which quantify growth model.