Economic Perspectives on Software Design: Pc Operating Systems and Platforms

88 Pages Posted: 6 Aug 2001  

Steven J. Davis

University of Chicago; National Bureau of Economic Research (NBER)

Kevin M. Murphy

University of Chicago; National Bureau of Economic Research (NBER)

Jack MacCrisken

Chicago Partners, LLC

Date Written: August 2001

Abstract

Improvements in the software that provides hardware management, user interface and platform functions have played a central role in the growth and transformation of the personal computer (PC) industry. Several forces shape the design of these 'operating system' products and propel their evolution over time, including: A. The need to efficiently manage the interacting components of PC systems so as to keep pace with rapid advances in computer technologies the development of applications software. B. The need to maintain compatibility with existing applications while preserving the flexibility to incorporate additional functions that support new applications. C. The desire to economize on customer support costs and assign clear responsibility for making the interacting components of the PC work together. D. The desire to bundle multiple software features into a single package so as to more effectively meet the demand for complementary applications or reduce the diversity in product valuations among consumers. We analyze these forces and the factors that determine whether and when new features and functions are included in commercial operating system products. We also explain how this integration and bundling spurs growth in the PC industry and fosters innovation.

Suggested Citation

Davis, Steven J. and Murphy, Kevin M. and MacCrisken, Jack, Economic Perspectives on Software Design: Pc Operating Systems and Platforms (August 2001). NBER Working Paper No. w8411. Available at SSRN: https://ssrn.com/abstract=278762

Steven J. Davis (Contact Author)

University of Chicago ( email )

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
773-702-7312 (Phone)
773-702-0458 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Kevin M. Murphy

University of Chicago ( email )

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
773-702-7280 (Phone)
773-702-2699 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Jack MacCrisken

Chicago Partners, LLC ( email )

140 S. Dearborn Street
Suite 1500
Chicago, IL 60603

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