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Why develop open-source software? The role of non-pecuniary benefits, monetary rewards, and open-source licence type

  • Robert M. Sauer

A review of the basic theory of optimal open-source software contributions points to three key factors affecting the decision to contribute to the open-source development process: nonpecuniary benefits, future expected monetary returns, and open-source licence type. This paper argues that existing large-scale software developer surveys are inadequate for measuring the relative importance of these three factors. Previous econometric studies that collect their own unique datasets also fall short because they generally measure the importance of only one supply factor in isolation. To fill the gap, I specify an estimable dynamic programming model of joint labour supply and open-source participation decisions that can provide empirical estimates of relative importance within a single unified framework of optimal decision-making.

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Article provided by Oxford University Press in its journal Oxford Review of Economic Policy.

Volume (Year): 23 (2007)
Issue (Month): 4 (Winter)
Pages: 605-619

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Handle: RePEc:oup:oxford:v:23:y:2007:i:4:p:605-619
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  1. Hertel, Guido & Niedner, Sven & Herrmann, Stefanie, 2003. "Motivation of software developers in Open Source projects: an Internet-based survey of contributors to the Linux kernel," Research Policy, Elsevier, vol. 32(7), pages 1159-1177, July.
  2. Chaim Fershtman & Neil Gandal, 2007. "Open source software: Motivation and restrictive licensing," International Economics and Economic Policy, Springer, vol. 4(2), pages 209-225, August.
  3. Lerner, Josh & Tirole, Jean, 2003. "The Scope of Open Source Licensing," IDEI Working Papers 219, Institut d'Économie Industrielle (IDEI), Toulouse.
  4. Harhoff, Dietmar & Henkel, Joachim & von Hippel, Eric, 2003. "Profiting from voluntary information spillovers: how users benefit by freely revealing their innovations," Research Policy, Elsevier, vol. 32(10), pages 1753-1769, December.
  5. Josh Lerner & Jean Tirole, 2005. "The Economics of Technology Sharing: Open Source and Beyond," Journal of Economic Perspectives, American Economic Association, vol. 19(2), pages 99-120, Spring.
  6. Michael P. Keane & Kenneth I. Wolpin, 1995. "The career decisions of young men," Working Papers 559, Federal Reserve Bank of Minneapolis.
  7. Henkel, Joachim, 2004. "The Jukebox Mode of Innovation - A Model of Commercial Open Source Development," CEPR Discussion Papers 4507, C.E.P.R. Discussion Papers.
  8. Bonaccorsi, Andrea & Rossi, Cristina, 2003. "Why Open Source software can succeed," Research Policy, Elsevier, vol. 32(7), pages 1243-1258, July.
  9. Sauer, R.M., 1996. "Job Mobility and the Market for Lawyers," Papers 28-96, Tel Aviv.
  10. repec:reg:rpubli:168 is not listed on IDEAS
  11. Lerner, Josh & Tirole, Jean, 2002. "Some Simple Economics of Open," Journal of Industrial Economics, Wiley Blackwell, vol. 50(2), pages 197-234, June.
  12. Keane, Michael P & Wolpin, Kenneth I, 1994. "The Solution and Estimation of Discrete Choice Dynamic Programming Models by Simulation and Interpolation: Monte Carlo Evidence," The Review of Economics and Statistics, MIT Press, vol. 76(4), pages 648-72, November.
  13. Stephen M. Maurer & Suzanne Scotchmer, 2006. "Open Source Software: The New Intellectual Property Paradigm," NBER Working Papers 12148, National Bureau of Economic Research, Inc.
  14. 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.
  15. Lakhani, Karim R. & von Hippel, Eric, 2003. "How open source software works: "free" user-to-user assistance," Research Policy, Elsevier, vol. 32(6), pages 923-943, June.
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