Open Source Software, Competition and Potential Entry
We analyze a model with two software firms, quality improving coding expenditures and potential competition. The firms can publish parts of their software as open source. Publishing software implies positive spillovers and thus reduces the firms' coding costs. On the other hand there exist two negative effects. First, lower coding costs induce higher coding expenditures which decreases the firms' profits if their programs are substitutes. Second, open source encourages entry and increases the expenditures required to deter entry. The firms' optimal open source decisions balance these opposite effects.
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- Josh Lerner, 2005.
"The Scope of Open Source Licensing,"
Journal of Law, Economics and Organization,
Oxford University Press, vol. 21(1), pages 20-56, April.
- Josh Lerner & Jean Tirole, 2003. "The Scope of Open Source Licensing," Levine's Working Paper Archive 506439000000000140, David K. Levine.
- Josh Lerner & Jean Tirole, 2002. "The Scope of Open Source Licensing," NBER Working Papers 9363, National Bureau of Economic Research, Inc.
- Lerner, Josh & Tirole, Jean, 2003. "The Scope of Open Source Licensing," IDEI Working Papers 219, Institut d'Économie Industrielle (IDEI), Toulouse.
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