In my headcanon it was all born from an experimental show (Big Brother) in around 2000 - which was obviously and intentionally stage managed but otherwise largely genuine behaviours. It took them a couple of seasons to really optimise for the "right" contestants and how to maximise the drama etc etc.
The move to more and more of reality tv content is as much about budgets as anything else imo
yeah, I'd agree with that, but the number of shows just exploded after the strike taking them from MTV to mainstream channels.