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Private Benefits, Warm Glow, and Reputation in the Free and Open Source Software Production Model

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  • JOHN P. CONLEY
  • FAN‐CHIN KUNG

Abstract

A great deal of production and consumption behavior takes place in the context of social organizations that seem to fall outside of the traditional paradigm of profit/utility maximization. These organizations are voluntary in nature and rely on contributions from members to achieve their objectives. Examples include the Linux operating system and other FOSS projects, political movements, churches and religious groups, Habitat for Humanity, and similar charitable organizations. In this paper, we consider a world containing agents with heterogeneous abilities who may voluntarily choose to make effort contributions to one or more different public projects. Agents are motivated by a desire to be seen as significant contributors to important and valuable projects, the warm glow from the act of contributing, and a desire to directly enjoy the benefits of projects when complete. We find that contributions from others can be either strategic complements or substitutes. We show that Nash equilibria exist and study how agents’ abilities and project quality affect the equilibrium levels of contributions.

Suggested Citation

  • John P. Conley & Fan‐Chin Kung, 2010. "Private Benefits, Warm Glow, and Reputation in the Free and Open Source Software Production Model," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 12(4), pages 665-689, August.
  • Handle: RePEc:bla:jpbect:v:12:y:2010:i:4:p:665-689
    DOI: 10.1111/j.1467-9779.2009.01469.x
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    File URL: https://doi.org/10.1111/j.1467-9779.2009.01469.x
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    References listed on IDEAS

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    1. Guth, Werner & Levati, M. Vittoria & Sutter, Matthias & van der Heijden, Eline, 2007. "Leading by example with and without exclusion power in voluntary contribution experiments," Journal of Public Economics, Elsevier, vol. 91(5-6), pages 1023-1042, June.
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    11. Andreoni, James, 1990. "Impure Altruism and Donations to Public Goods: A Theory of Warm-Glow Giving?," Economic Journal, Royal Economic Society, vol. 100(401), pages 464-477, June.
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    Cited by:

    1. Ergin Bayrak & John P. Conley & Simon Wilkie, 2011. "The Economics of Cloud Computing," Korean Economic Review, Korean Economic Association, vol. 27, pages 203-230.
    2. repec:eee:gamebe:v:104:y:2017:i:c:p:24-42 is not listed on IDEAS
    3. Lise Vesterlund & Anat Bracha, 2013. "How low can you go? Charity reporting when donations signal income and generosity," Working Papers 13-11, Federal Reserve Bank of Boston, revised 18 Oct 2013.
    4. John P. Conley, 2019. "Economic Implications of New Technologies for Licensed and Unlicensed Spectrum," Vanderbilt University Department of Economics Working Papers 19-00011, Vanderbilt University Department of Economics.

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