31 Pages Posted: 16 Sep 2004
Date Written: January 3, 2006
This article explains why both software developers and firms contribute to the production of Open Source Software (OSS). Existing economic theories either focus on the supply side (developers) or the demand side (firms) of OSS development. This paper is the first to explain both sides in one integrated model by understanding the OSS production process as an application contest to the network of prominent developers. Programmers contribute because they aim for reputation and high salaries. Firms finance the process, since they receive inside information on highly talented developers not yet known on the regular job market.
Keywords: Open Source Software, Contest, Asymmetric Auctions, Networks, Career Concerns
JEL Classification: D82, L14, L86
Suggested Citation: Suggested Citation
Prufer, Jens, Why Do Developers and Firms Contribute to the Production of Open Source Software? (January 3, 2006). Available at SSRN: https://ssrn.com/abstract=590581 or http://dx.doi.org/10.2139/ssrn.590581