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The Simple Economics of Open Source
Jean Tirole University of Toulouse 1 - Industrial Economic Institute (IDEI); University of Toulouse 1 - Groupe de Recherche en Economie Mathématique et Quantitative (GREMAQ); Centre for Economic Policy Research (CEPR) Josh Lerner Harvard Business School - Finance Unit; Harvard University - Entrepreneurial Management Unit; National Bureau of Economic Research (NBER) October 2000 HBS Finance Working Paper No. 00-059 Abstract: 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.
JEL Classifications: L22, L31, L86 Working Paper SeriesDate posted: April 27, 2000 ; Last revised: October 04, 2005Suggested CitationContact Information
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