The Simple Economics of Open Source
Josh Lerner, Jean Triole
NBER Working Paper No. 7600
There has been a recent surge of interest in open source software development, which involves developers at many different locations and organizations sharing code to develop and refine programs. To an economist, the behavior of individual programmers and commercial companies engaged in open source projects is initially startling. This paper makes a preliminary exploration of the economics of open source software. We highlight the extent to which labor economics, especially the literature on career concerns,' can explain many of these projects' features. Aspects of the future of open source development process, however, remain somewhat difficult to predict with off-the-shelf' economic models.
Published: "Some Simple Economics of Open Source," Journal of Industrial Economics, 52 (June 2002) 197-234.