Do Open Source Developers Respond to Competition?: The (La)TeX Case Study

Abstract:     
This paper traces the history of the development and use of the Open Source TeX typesetting program. This software was developed over three decades and came into competition with a variety of open-source and proprietary alternatives. TeX was an early and very successful open-source project that imposed its standards in a particularly competitive environment and inspired many advances in the typesetting industry. While developers working under proprietary and open-source licenses responded to different sets of motivations, this did not mean they could abstract from each other's development decisions. The development of each type of software evolved in a symbiotic way. The strengths and weaknesses of both development methods were starkly revealed in the process. A pattern of semi-altruistic open-source development emerged, whereby developers considered non-developers' needs in order to make TeX more attractive to a broader audience and more competitive vs. proprietary alternatives. Self-use motivations for development were complemented by direct and indirect network effect considerations. This paper contributes to a better understanding of the long-term welfare effect of the emergence and growing importance of open-source development methods.

Number of Pages in PDF File: 38

Keywords: Open Source Software, Network Effects, Product Differentiation, Information Goods, Intellectual Property, Competition, Production Systems, Non-Profit, Volunteer Organizations

JEL Classification: D23, H41, L13, L22, L31, L86, O34, O38

working papers series