Funding Ingenuity: The Impact of Microgrants on the Rate and Direction of Innovation

Cambridge, Massachusetts
EconomicsData Science
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About This Project

Traditional funders are conservative in the types of ideas and researchers they fund. Furthermore, funding agencies are designed to efficiently deliver large grants, but are unequipped to sustain experimentation at a smaller scale. Recent empirical evidence (Howell, 2015) shows that smaller grants can have a large impact on subsequent innovation because of a "certification effect": i.e. they help society identify valuable ideas and projects. Crowdfunding has the potential to implement this at scale, resulting in impactful science at a lower cost than currently possible. By awarding small matching grants of $1-5k to young scientists, we aim to test this hypothesis and explore the conditions under which crowdfunding can outperform traditional funding methods. Key outcomes of interest will be the scieitific impact of the work conducted by these young researchers.

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What is the context of this research?

There are many examples of breakthrough discoveries being made by young researchers. The first monetary award to an unestablished scientist can also influence if that individual chooses science as a career. Through this pilot we want to understand if microgrants can fund novel ideas at scale.

What is the significance of this project?

There has been anecdotal evidence that small monetary rewards make the greatest difference in an unestablished scientist's decision to pursue science as a career. Programs like HHMI and NSF REU have supported small awards for young scientists, but there's no peer-reviewed scientific study that analyzes the causal relationship between microgrants and scientific impact.

In our study we will award up to 500 projects with an average of $2,000 each to answer a specific research question. Each project will post periodic updates on the progress of the project and once the project is complete, publicly post the conclusive or inconclusive results of the proposed experiment.

What are the goals of the project?

Our hypothesis is awarding small grants of $5,000 or less to young scientists will result in equal or greater scientific impacts as large grants to established researchers. To test this we need a system to incentivize young scientists to submit proposals for $5,000 or less. From our initial study, we developed an effective method to incentivize scientist with a $500 - $10k prize. Now we want to test if incentivizing scientists with a 2x matching for up to $2,000 for their campaigns can increase our program sample size.

We plan to start this in March 2017 with 10 programs every month for 3 months. Each month 50% of challenge programs will be treated with a 2x matching, 50% challenge programs will serve as the controls.


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Over the course of 3 months we will run 30 challenge programs targeting specific research areas that are underserved by the traditional funding agencies. 15 challenge programs or 50% of the participants will be incentivized with a 2x matching for their campaigns. The control group will not be incentivized with a 2x matching.

Each program will support up to 30 projects and no fewer than 10 projects.

Each project that is supported with the 2x matching will receive up to $2,000 in matched donations by our foundation partner.

Meet the Team

Cindy Wu
Cindy Wu

Team Bio

Cindy is co-founder of Experiment. Her team will be responsible for executing the proposed experiment on the experiment platform.

Christian is Assistant Professor at the MIT Sloan School of Management. His research team at MIT will be responsible for designing the experiment and analyzing the results of the study for a peer-reviewed publication.

Foundation X will be providing the matching for this study.

Cindy Wu

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Additional Information


Financing Innovation: Evidence from R&D Grants

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