The household sector innovation ecosystem: A framework and policy implications

Household sector (HHS) innovation research shows that citizens around the globe commonly develop functionally novel goods and applications, at private cost during their leisure time. Their innovations can be useful to other citizens, inspire new lines of products, and give birth to new businesses. However, citizens also face challenges in developing and spreading their innovations, like information asymmetries, the indivisibility of required investments, and a lack of diffusion incentives. These legitimize policy interventions, but an integral overview of factors influencing HHS innovation (and diffusion) is missing. We apply an ecosystem perspective to develop an overview of the elements enabling HHS innovation (and diffusion), leading to a more integral understanding. Based on a literature search and expert interviews, our framework includes five key facilitators (human capital, innovation tools, platforms and workshops, resources and infrastructure, and producers and industry) and three environmental conditions (social capital, rules and regulation, and cultural norms and values). It provides a basis to classify the policies suggested so far, to guide data collection at the regional level, and to advance the research agenda on HHS innovation. • We developed an ecosystem model explaining household sector (HHS) innovation. • Five direct facilitators explain HHS innovation. • HHS innovation and its facilitators are shaped by three environmental conditions. • Considering HHS innovation as an ecosystem output facilitates holistic innovation policies. • Our ecosystem model of HHS innovation (diffusion) offers a toolkit for policymakers.