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This has interesting implications for organizational dynamics: the more you can allow people across the organization to innovate, rather than relying on promotion and formal recognition to pre-pick winners, the more likely the company will benefit from future luck. And it may be more valuable for a company to hire a bunch of people who are just "good enough" than one person who is a super-genius, because it makes it more likely the company will get lucky.

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I always find it interesting how employers pay you for your labor, yet they implicitly also have an option on any significant innovation you produce. In a truly competitive labor market, employers would have to compensate for this option value (ie. employees who are more likely to have breakthroughs, as separate from any incremental project work).

This is a fascinating point. Perhaps the cleanest way to fairly treat your option value is to not compensate you in expectation, but to allow you to "sell" your idea internally when you have them. Employees could get a royalty, say, for a successful idea. Pricing the royalty is difficult, but it's still an interesting idea.

As I write, I realize this must have been tried somewhere. I know at one point Sandia Labs allowed employees to start spin-offs using tech developed there, but that's not quite the same.

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