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The Architecture of Participation: Does Code Architecture Mitigate Free Riding in the Open Source Development Model?

  • Carliss Y. Baldwin


    (Harvard Business School, Baker Library, Boston, Massachusetts 02163)

  • Kim B. Clark


    (Brigham Young University-Idaho, Rexburg, Idaho 83460)

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    This paper argues that the architecture of a codebase is a critical factor that lies at the heart of the open source development process. We define two observable properties of an architecture: (1) modularity and (2) option value. Developers can often make informed judgments about modularity and option value from early, partially implemented code releases. We show that codebases that are more modular or have more option value (1) increase developers' incentives to join and remain involved in an open source development effort and (2) decrease the amount of free riding in equilibrium. These effects occur because modularity and option value create opportunities for the exchange of valuable work among developers, opportunities that do not exist in codebases that are not modular or have no option value.

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    Article provided by INFORMS in its journal Management Science.

    Volume (Year): 52 (2006)
    Issue (Month): 7 (July)
    Pages: 1116-1127

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    Handle: RePEc:inm:ormnsc:v:52:y:2006:i:7:p:1116-1127
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    1. Rishab Aiyer Ghosh, 1998. "Cooking pot Markets: an Economic Model for the Trade in Free Goods and Services on the Internet," Brazilian Electronic Journal of Economics, Department of Economics, Universidade Federal de Pernambuco, vol. 1(1), July.
    2. Milgrom, Paul & Roberts, John, 1990. "The Economics of Modern Manufacturing: Technology, Strategy, and Organization," American Economic Review, American Economic Association, vol. 80(3), pages 511-28, June.
    3. Carliss Y. Baldwin & Kim B. Clark, 2000. "Design Rules, Volume 1: The Power of Modularity," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262024667, December.
    4. Lerner, Josh & Tirole, Jean, 2002. "Some Simple Economics of Open," Journal of Industrial Economics, Wiley Blackwell, vol. 50(2), pages 197-234, June.
    5. Justin Pappas Johnson, 2002. "Open Source Software: Private Provision of a Public Good," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 11(4), pages 637-662, December.
    6. Sonali K. Shah, 2006. "Motivation, Governance, and the Viability of Hybrid Forms in Open Source Software Development," Management Science, INFORMS, vol. 52(7), pages 1000-1014, July.
    7. Robert C. Merton, 1973. "Theory of Rational Option Pricing," Bell Journal of Economics, The RAND Corporation, vol. 4(1), pages 141-183, Spring.
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