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What Is “Open”? An Economic Analysis of Open Institutions

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  • Deng, Feng
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    Abstract

    By examining several different types of open institutions including open source software, open science, open square and (open) urban planning, this paper presents a general analysis of open institutional structure that is complementary to traditional proprietary mode. We argue that open institutions, in whatever forms, are essentially about decentralized production of a collective good (or “commons”) that relies on voluntary collaboration of highly variable human-related input. In addition to providing a general definition of open institutional structure, we submit there are two necessary conditions for open institutions. The first is the integration of consumers into production. The second condition is that the efficiency gain from “production” commons is the objective and the tragedy of anticommons becomes a serious problem. In this sense, open institutions represent a positive approach toward externality and uncertainty.

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    File URL: http://mpra.ub.uni-muenchen.de/8888/
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    Bibliographic Info

    Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 8888.

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    Date of creation: 10 Jan 2008
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    Handle: RePEc:pra:mprapa:8888

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    Keywords: open institutions; collective good; open source software; open science; open square; urban planning;

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    1. Richard N. Langlois & Nicolai J. Foss, 1996. "Capabilities and Governance the Rebirth of Production in the Theory of Economic Organization," Working papers 1996-02, University of Connecticut, Department of Economics.
    2. Andrea Bonaccorsi & Cristina Rossi, 2002. "Why open source software can succeed," LEM Papers Series 2002/15, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    3. F Frederic Deng, 2003. "The rebound of private zoning: property rights and local governance in urban land use," Environment and Planning A, Pion Ltd, London, vol. 35(1), pages 133-149, January.
    4. Josh Lerner & Jean Tirole, 2004. "The Economics of Technology Sharing: Open Source and Beyond," NBER Working Papers 10956, National Bureau of Economic Research, Inc.
    5. Francesco Parisi & Norbert Schulz & Ben Depoorter, 2004. "Simultaneous and Sequential Anticommons," European Journal of Law and Economics, Springer, vol. 17(2), pages 175-190, March.
    6. Alan MacCormack & John Rusnak & Carliss Y. Baldwin, 2006. "Exploring the Structure of Complex Software Designs: An Empirical Study of Open Source and Proprietary Code," Management Science, INFORMS, INFORMS, vol. 52(7), pages 1015-1030, July.
    7. Buchanan, James M & Yoon, Yong J, 2000. "Symmetric Tragedies: Commons and Anticommons," Journal of Law and Economics, University of Chicago Press, vol. 43(1), pages 1-13, April.
    8. Josh Lerner & Jean Triole, 2000. "The Simple Economics of Open Source," NBER Working Papers 7600, National Bureau of Economic Research, Inc.
    9. Douglass C North & John Joseph Wallis & Barry R. Weingast, 2006. "A Conceptual Framework for Interpreting Recorded Human History," NBER Working Papers 12795, National Bureau of Economic Research, Inc.
    10. Cheung, Steven N S, 1970. "The Structure of a Contract and the Theory of a Non-exclusive Resource," Journal of Law and Economics, University of Chicago Press, vol. 13(1), pages 49-70, April.
    11. F. Frederic Deng, 2003. "Collective Goods and the Political Hold-Up Problem," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 159(2), pages 414-434, June.
    12. David, Paul A, 1998. "Common Agency Contracting and the Emergence of "Open Science" Institutions," American Economic Review, American Economic Association, vol. 88(2), pages 15-21, May.
    13. Bruce Kogut & Anca Metiu, 2001. "Open-Source Software Development and Distributed Innovation," Oxford Review of Economic Policy, Oxford University Press, vol. 17(2), pages 248-264, Summer.
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