Immediate and enduring effects of digital badges on online content consumption and generation

Awarding users digital badges for their contributions such as generating valuable content and participating in community activities has become an increasingly popular practice on user-generated content (UGC) platforms to incentivize user engagement. Beyond their immediate effects, digital badges can have enduring effects on UGC consumption and generation by affecting users’ underlying engagement states. To account for both effects, the authors develop a bivariate negative binomial hidden Markov model of content consumption and generation and estimate the model using a panel data set obtained from a large UGC platform. They find that users increase their content generation but decrease their content consumption immediately after being awarded a digital badge. Furthermore, being awarded a digital badge has a positive enduring effect on both content consumption and content generation behaviors of a user. This positive enduring effect mainly applies to users in relatively engaged states but not to users in the least engaged state. Finally, the authors demonstrate the value of the proposed model with respect to assessing consumer responses to the design of digital badges.