Bessen (2005)

From Copyright EVIDENCE

Advertising Architectural Publishing of books, periodicals and other publishing Programming and broadcasting Computer programming Computer consultancy Creative, arts and entertainment Cultural education

Film and motion pictures Sound recording and music publishing Photographic activities PR and communication Software publishing (including video games) Specialised design Television programmes Translation and interpretation

1. Relationship between protection (subject matter/term/scope) and supply/economic development/growth/welfare 2. Relationship between creative process and protection - what motivates creators (e.g. attribution; control; remuneration; time allocation)? 3. Harmony of interest assumption between authors and publishers (creators and producers/investors) 4. Effects of protection on industry structure (e.g. oligopolies; competition; economics of superstars; business models; technology adoption) 5. Understanding consumption/use (e.g. determinants of unlawful behaviour; user-generated content; social media)

A. Nature and Scope of exclusive rights (hyperlinking/browsing; reproduction right) B. Exceptions (distinguish innovation and public policy purposes; open-ended/closed list; commercial/non-commercial distinction) C. Mass digitisation/orphan works (non-use; extended collective licensing) D. Licensing and Business models (collecting societies; meta data; exchanges/hubs; windowing; crossborder availability) E. Fair remuneration (levies; copyright contracts) F. Enforcement (quantifying infringement; criminal sanctions; intermediary liability; graduated response; litigation and court data; commercial/non-commercial distinction; education and awareness)

Source Details

Bessen (2005)
Title: Open source software: Free provision of complex public goods
Author(s): Bessen, J. E.
Year: 2005
Citation: Bessen, J. E. (2005). Open source software: Free provision of complex public goods. Boston University. Available at SSRN 588763.
Link(s): Definitive , Open Access
Key Related Studies:
Discipline:
Linked by:
About the Data
Data Description: Empirical analysis of a case study (partially based on Aghion and Tirole's 1994 model of innovation). No original data used.
Data Type:
Secondary Data Sources:
Data Collection Methods:
Data Analysis Methods:
Industry(ies):
Country(ies):
Cross Country Study?: No
Comparative Study?: No
Literature review?: No
Government or policy study?: No
Time Period(s) of Collection:
Funder(s):
  • Not stated

Abstract

Open source software, developed by volunteers, appears counter to the conventional wisdom that private provision of public goods is socially more efficient. But complexity makes a difference. Under standard models, development contracts for specialized software may be difficult to write and ownership rights do not necessarily elicit socially optimal effort. I consider three mechanisms that improve the likelihood that firms can obtain the software they need: pre-packaged software, Application Program Interfaces (APIs) and Free/Open Source software (FOSS). I show that with complex software, some firms will choose to participate in FOSS over both "make or buy" and this increases social welfare. In general, FOSS complements proprietary provision, rather than replacing it. Pre-packaged software can coexist in the marketplace with FOSS: pre-packaged software addresses common uses with limited feature sets, while firms with specialized, more complex needs use FOSS.

Main Results of the Study

This analysis may help dispel two myths about F/OSS (Free/Open Source Software):

  • First, it is not a “communistic,” “property destroying” alternative to proprietary software. It is better viewed as a complement to proprietary provision, recognizing that proprietary provision fails to effectively meet the needs of many customers in markets where customers have highly disparate needs and products are complex.
  • Second, it is a mistake to assume that F/OSS is somehow less robust because it is based on voluntary contributions rather than driven by the profit incentive. In fact, the firms that participate in F/OSS are driven by the profit incentive – F/OSS is just the most socially efficient means for many of them to obtain the software they need in their profit-making activities.

Managers need to view F/OSS as an alternative to simple “make-or-buy.” This alternative will make the most sense for firms with specialized and complex needs. And it may be especially important in emerging technologies where markets are initially small.

Policy Implications as Stated By Author

Managers need to view F/OSS as an alternative to simple “make-or-buy.” This alternative will make the most sense for firms with specialized and complex needs. And it may be especially important in emerging technologies where markets are initially small.


Coverage of Study

Coverage of Fundamental Issues
Issue Included within Study
Relationship between protection (subject matter/term/scope) and supply/economic development/growth/welfare
Green-tick.png
Relationship between creative process and protection - what motivates creators (e.g. attribution; control; remuneration; time allocation)?
Harmony of interest assumption between authors and publishers (creators and producers/investors)
Effects of protection on industry structure (e.g. oligopolies; competition; economics of superstars; business models; technology adoption)
Green-tick.png
Understanding consumption/use (e.g. determinants of unlawful behaviour; user-generated content; social media)
Coverage of Evidence Based Policies
Issue Included within Study
Nature and Scope of exclusive rights (hyperlinking/browsing; reproduction right)
Exceptions (distinguish innovation and public policy purposes; open-ended/closed list; commercial/non-commercial distinction)
Mass digitisation/orphan works (non-use; extended collective licensing)
Licensing and Business models (collecting societies; meta data; exchanges/hubs; windowing; crossborder availability)
Green-tick.png
Fair remuneration (levies; copyright contracts)
Enforcement (quantifying infringement; criminal sanctions; intermediary liability; graduated response; litigation and court data; commercial/non-commercial distinction; education and awareness)

Datasets