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Bug-Fixing and Code-Writing: The Private Provision of Open Source Software

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  • Jürgen Bitzer
  • Philipp J. H. Schröder

Abstract

Open source software (OSS) is a public good. A self-interested individual would consider providing such software, if the benefits he gained from having it justified the cost of programming. Nevertheless each agent is tempted to free ride and wait for others to develop the software instead. This problem is modelled as a war of attrition with complete information, job signaling, repeated contribution to the public good and uncertainty in programming. The resulting game does not feature any delay: software will be provided swiftly, by young, low-cost individuals who gain considerably by signaling their programming skills; the startup (and collapse) of an OSS project displays bandwagon dynamics.

Suggested Citation

  • Jürgen Bitzer & Philipp J. H. Schröder, 2002. "Bug-Fixing and Code-Writing: The Private Provision of Open Source Software," Discussion Papers of DIW Berlin 296, DIW Berlin, German Institute for Economic Research.
  • Handle: RePEc:diw:diwwpp:dp296
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    References listed on IDEAS

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    Cited by:

    1. Schmidtke, Richard, 2006. "Private Provision of a Complementary Public Good," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 134, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
    2. Bitzer, Jürgen & Geishecker, Ingo, 2010. "Who contributes voluntarily to OSS? An investigation among German IT employees," Research Policy, Elsevier, vol. 39(1), pages 165-172, February.
    3. Bitzer, Jurgen & Schrettl, Wolfram & Schroder, Philipp J.H., 2007. "Intrinsic motivation in open source software development," Journal of Comparative Economics, Elsevier, vol. 35(1), pages 160-169, March.
    4. Richard Schmidtke, 2006. "Private Provision of a Complementary Public Good," Working Papers 004, Bavarian Graduate Program in Economics (BGPE).
    5. Jürgen Bitzer & Philipp J.H. Schröder, 2005. "The Impact of Entry and Competition by Open Source Software on Innovation Activity," Industrial Organization 0512001, EconWPA.
    6. Paolo CROSETTO, 2010. "To patent or not to patent: a pilot experiment on incentives to copyright in a sequential innovation setting," Departmental Working Papers 2010-05, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    7. Gauguier, Jean-Jacques, 2009. "L’industrialisation de l’Open Source," Economics Thesis from University Paris Dauphine, Paris Dauphine University, number 123456789/4388 edited by Toledano, Joëlle, March.
    8. Nordine Benkeltoum, 2012. "Open source et systèmes critiques : le cas Thales," Post-Print hal-00905919, HAL.
    9. Schmidtke, Richard, 2006. "Private Provision of a Complementary Public Good," Discussion Papers in Economics 964, University of Munich, Department of Economics.
    10. 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.
    11. Stefano Colombo & Luca Grilli & Cristina Rossi-Lamastra, 2014. "Network Externalities, Incumbent’s Competitive Advantage and the Degree of Openness of Software Start-Ups," Computational Economics, Springer;Society for Computational Economics, vol. 44(2), pages 175-200, August.
    12. Bitzer, Jurgen, 2004. "Commercial versus open source software: the role of product heterogeneity in competition," Economic Systems, Elsevier, vol. 28(4), pages 369-381, December.
    13. Jürgen Bitzer & Philipp J. H. Schröder, 2003. "Competition and Innovation in a Technology Setting Software Duopoly," Discussion Papers of DIW Berlin 363, DIW Berlin, German Institute for Economic Research.
    14. Casadesus-Masanell, Ramon & Ghemawat, Pankaj, 2003. "Dynamic mixed duopoly: A model motivated by Linux vs. Windows," IESE Research Papers D/519, IESE Business School.
    15. Poul Houman Andersen & Ina Drejer, 2006. "Systemic Innovation in a Distributed Network Paradox or Pinnacle?," DRUID Working Papers 06-13, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.
    16. Noriaki Matsushima & Ryusuke Shinohara, 2012. "Private Provision of Public Goods that are Complements for Private Goods: Application to Open Source Software Developments," ISER Discussion Paper 0830, Institute of Social and Economic Research, Osaka University.
    17. Bitzer, Jürgen & Schrettl, Wolfram & Schröder, Philipp J.H., 2006. "Intrinsic Motivation versus Signaling in Open Source Software Development," Working Papers 06-7, University of Aarhus, Aarhus School of Business, Department of Economics.
    18. Maria Alessandra Rossi, 2004. "Decoding the "Free/Open Source(F/OSS) Software Puzzle" a survey of theoretical and empirical contributions," Department of Economics University of Siena 424, Department of Economics, University of Siena.
    19. Stenborg, Markku, 2003. "Waiting for F/OSS: Coordinating the Production of Free/Open Source Software," Discussion Papers 884, The Research Institute of the Finnish Economy.
    20. Cerquera Dussán, Daniel & Müller, Bettina, 2009. "Open Source, ICT infrastructure and firm performance," ZEW Discussion Papers 09-089, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.

    More about this item

    Keywords

    open source software; war of attrition; public goods;

    JEL classification:

    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
    • L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs; Social Entrepreneurship

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