Daniel P. Gross is an assistant professor of business administration in the Strategy Unit. Professor Gross studies the drivers and consequences of innovation, with a research program examining the effects of automation on workers, firms, and labor markets; the historical origins of U.S. leadership in science and technology since the second World War; and the use of incentives and other tools in managing creative workers within organizations. His research frequently uses historical examples of industries undergoing significant technological change as a lens into the present and future.
Daniel P. Gross is an assistant professor of business administration in the Strategy Unit. He was previously a postdoctoral fellow at Harvard Business School and the National Bureau of Economic Research.
Professor Gross studies the drivers and consequences of innovation, with a three-part research program examining (i) the effects of automation on workers, firms, and labor markets, (ii) the historical origins of U.S. leadership in science and technology since the second World War, and (iii) the use of incentives and other tools in managing creative workers within organizations. A common theme throughout much of Professor Gross' work is the use of history as a lens for understanding opportunities and challenges that firms, consumers, and policymakers face today and into the future. His research on creativity has been featured in The New York Times.
Professor Gross received his Ph.D. in economics from the University of California, Berkeley, where he was a graduate fellow of the National Science Foundation, the University of California, and the Economic History Association. Prior to graduate school, he worked in policy research, management consulting, and at a high-growth startup that went on to achieve a successful exit.
Although tractors are now used in nearly every agricultural field operation and in the production of nearly all crops, they first developed with much more limited application. Early diffusion was accordingly rapid in these narrower applications but limited in scope until tractor technology generalized. The sequence of diffusion is consistent with a model of research and development (R&D) in specific- versus general-purpose attributes and with other historical examples, suggesting that the key to understanding technology diffusion lies not only in explaining the number of different users but also in explaining the number of different uses.
Performance feedback is ubiquitous in competitive settings where new products are developed. This article introduces a fundamental tension between incentives and improvement in the provision of feedback. Using a sample of 4,294 commercial logo design tournaments, I show that feedback reduces participation but improves the quality of subsequent submissions, with an ambiguous effect on high-quality output. To evaluate this trade-off, I develop a procedure to estimate agents' effort costs and simulate counterfactuals under alternative feedback policies. The results suggest that feedback on net increases the number of high-quality ideas produced and is thus desirable for a principal seeking innovation.
This paper studies the effects of the USPTO's patent secrecy program in World War II, under which approximately 11,200 U.S. patent applications were issued secrecy orders which halted examination and prohibited inventors from disclosing their inventions or _ling in foreign countries. Secrecy orders were issued most heavily in areas important to the war effort { such as radar, electronics, and synthetic materials { and nearly all rescinded at the end of the war. I find that compulsory invention secrecy was effective at keeping affected technology out of the public domain, but it appears to have reduced and delayed follow-on invention, restricted commercialization, and temporarily hampered post-war entry into patenting. The results shed light on the consequences of invention secrecy, which is widely used by inventors to protect and appropriate the returns to innovation, and yield lessons for ongoing policy debates over potential measures to protect U.S. invention against the growing incidence of foreign IP theft today.
Though fundamental to innovation and essential to many industries and occupations, individual creativity has received limited attention as an economic behavior and has historically proven difficult to study. This paper studies the incentive effects of competition on individuals' creative production. Using a sample of commercial logo design competitions, and a novel, content-based measure of originality, I find that intensifying competition induces agents to produce original, untested ideas over tweaking their earlier work, but heavy competition drives them to stop investing altogether. The results yield lessons for the management of creative workers and for the implementation of competitive procurement mechanisms for innovation.
Compatibility standards are pervasive in the modern economy, as well as a target of public and private investment, yet there is limited evidence on their economic effects. This paper studies the conversion of 13,000 miles of railroad track in the U.S. South to standard gauge on May 31 and June 1, 1886, as a natural experiment in compatibility. Route-level freight traffic data reveal that the gauge change caused a large redistribution of traffic from steamships to railroads that declines with distance but did not affect total shipments or prices on these routes, possibly due to carriers' anticompetitive conduct. Guided by these results, I develop a model of compatibility choice in a collusive market and show that competition can increase pass-through of the cost savings from compatibility and in turn total shipments, but it may bring the gauge change itself into question.
Gross, Daniel P., and William R. Kerr. "AT&T: Managing Technological Change and the Future of Telephone Operators in the 20th Century." Harvard Business School Teaching Note 718-518, May 2018.
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By the 1930s, AT&T dominated the American phone industry, serving 10 million telephones and employing over 100,000 switchboard operators. But beginning in the mid-1910s, the company began changing from manually operated switchboards to mechanical switching systems that were faster and more cost-effective and did not require human operators. By the 1930s, the changeover has been completed or is underway in most American cities with over 50,000 people. The rollout of the new technology is garnering a good deal of public attention, not just for the unfamiliar new “dialing” process that customers are required to learn, but also because of the mass layoffs of the women who served as operators. The job cuts have even resulted in reports from the Department of Labor and Congressional hearings. As the rollouts continue across the country, AT&T questions how to handle the layoffs and the reaction to the new system.
In September 2014, Tom Montgomery (SVP of strategic initiatives at the De Beers Group) and his team launched a pilot program in the United States to explore $1 billion diamond market for pre-owned (recycled) diamonds. According to Montgomery, the motivation for the pilot program was to improve the consumer reselling experience and to enhance "diamond equity". Somewhat paradoxically, consumers typically received very low prices when they tried to sell diamonds (5-20% of the priginal retail price) leaving them reluctant to purchase diamonds in the future and making them into ambassadors of ill will. At a meeting scheduled for November 2015, the De Beers Executive Committee would have to decide whether to end the pilot program, extend it for another year to gather more information, or convert it into a new standalone business unit. Because De Beers had historically focused on producing rough diamonds (the "upstream" business), yet the new business unit offered an opportunity to enter and enhance the market for polished diamonds (the "downstream" business), the decision was particularly noteworthy. Teaching Note for HBS No. 717-430.
Esty, Benjamin C., Daniel P. Gross, and Lauren G. Pickle. "The De Beers Group: Exploring the Diamond Reselling Opportunity." Harvard Business School Teaching Note 717-481, June 2017.
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In September 2014, Tom Montgomery (SVP of strategic initiatives at the De Beers Group) and his team launched a pilot program in the United States to explore the $1 billion diamond market for pre-owned (recycled) diamonds. According to Montgomery, the motivation for the pilot program was to improve the consumer reselling experience and to enhance "diamond equity". Somewhat paradoxically, consumers typically received very low prices when they tried to sell diamonds (5-20% of the original retail price) leaving them reluctant to purchase diamonds in the future and making them into ambassadors of ill will. At a meeting scheduled for November 2015, the De Beers Executive Committee would have to decide whether to end the pilot program, extend it for another year to gather more information, or convert it into a new standalone business unit. Because De Beers had historically focused on producing rough diamonds (the "upstream" business), yet the new business unit offered an opportunity to enter and enhance the market for polished diamonds (the "downstream" business), the decision was particularly noteworthy.
Esty, Benjamin C., Daniel P. Gross, and Lauren G. Pickle. "The De Beers Group: Exploring the Diamond Reselling Opportunity." Harvard Business School Spreadsheet Supplement 717-806, February 2017.
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In September 2014, Tom Montgomery (SVP of strategic initiatives at the De Beers Group) and his team launched a pilot program in the United States to explore the $1 billion diamond market for pre-owned (recycled) diamonds. According to Montgomery, the motivation for the pilot program was to improve the consumer reselling experience and to enhance "diamond equity." Somewhat paradoxically, consumers typically received very low prices when they tried to sell diamonds (5-20% of the original retail price) leaving them reluctant to purchase diamonds in the future and making them into ambassadors of ill will. At a meeting scheduled for November 2015, the De Beers Executive Committee would have to decide whether to end the pilot program, extend it for another year to gather more information, or convert it into a new standalone business unit. Because De Beers had historically focused on producing rough diamonds (the "upstream" business), yet the new business unit offered an opportunity to enter and enhance the market for polished diamonds (the "downstream" business), the decision was particularly noteworthy.
