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Optimal Firm Contributions to Open Source SoftwareErnan HaruvyUniversity of Texas at Dallas - Naveen Jindal School of Management Ashutosh PrasadUniversity of Texas at Dallas - Naveen Jindal School of Management Suresh SethiUniversity of Texas at Dallas - Naveen Jindal School of Management Rong ZhangChongqing University - College of Economics and Business Administration MANAGEMENT SCIENCE AND ECONOMICS, Christophe Deissenberg and Richard F. Hartl, eds., pp. 197-212, Springer, 2005 Abstract: This paper examines open source software development in a competitive environment. The quality of open source software improves over time based upon contributions by firms and users. A firm's decision to contribute is interesting because it also augments competitors' software quality in future periods subject to compatibility considerations with their existing software. A differential game model is developed to understand why firms are increasingly involved in open source software development by determining the optimal contributions and software quality over time. We obtain a closed-loop Nash equilibrium solution. Examples are given to derive insights from this model.
Number of Pages in PDF File: 25 Keywords: Open sourcd software, dynamic games, game theory, differential games, optimal control, close-loop Nash equilibrium, software quality JEL Classification: C61, D42, M00 Accepted Paper SeriesDate posted: May 12, 2008 ; Last revised: October 7, 2008Suggested CitationContact Information
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