Economics and Open Source Projects 214
david_christie writes "Dan
Gillmor has a piece on the economist Yochai Benkler's
paper "Coase's Penguin, or Linux and the Nature of the
Firm" which examines open source projects
asan example of an emerging general model of economic behavior that is neither market nor company based. A previous version of the paper was noted
in slashdot back in October, but it's been revised for upcoming publication
in the Yale Law Review and is well worth a second look. Benkler attempts to
explain why open source projects succeed, without falling back on theories about
the special nature of software projects or hacker culture. He suggests that
more general economic principles are at work, which are displacing the
traditional motivations (market prices and employee relationships) that
economists use to quantify individual behavior. If he's right the open source
model could spread to other forms of creative work where the output is
information or culture (music production comes to mind). The author thinks
deeply about the information flows characterizing collaborative projects like
free software development ("commons-based peer production"). That distinguishes
this paper from the usual economist mumbo-jumbo about price points and such.
Like Larry Lessig on the
legal side of things, this is a guy who gets it and has thought deeply about how
his field relates to it."
Open-source music? (Score:4, Insightful)
What does that leave us? Amateur musicians like myself pimping their home-grown stuff. Which in some cases will be as good as or better than the pros, but the vast majority of it will be as cruddy as all those non-updated open source projects on Sourceforge...
Re:Open-source music? (Score:5, Interesting)
I.e. basically they have a salary paid by others and not by people buying their recorded music.
It's actually very few people who make money selling records - most of them actually work at the record company and are not musicians at all. They are mostly managers, agents and record bosses.
Re:Open-source music? (Score:2, Interesting)
Re:Open-source music? (Score:2)
Actually most professional musicians does not get paid by recording CDs
I think we know that already. This point only been stated about a billion times on Slashdot before, although it always gets modded up to +5, insightful (sometimes multiple times in the same thread), so I guess it's good for karma whoring.
- they get paid by performing music at clubs and other venues.
Actually, most of those people hardly make any money performing. A lot of them have a full time job and they play music in their spare time.
Let's look at what the OP said: Do you think all the bands out there who are getting ripped off by the labels wanted to give their music away for free? Of course not. They signed a contract thinking they were going to make money but they didn't. That makes them far more likely to sell their music through an alternate channel (e.g. a personal website) than to GPL it.
-a
Re:Open-source music? (Score:5, Insightful)
But you know what all this is? It's called CHOICE. And it has always been there. Corporate sponsorship of creativity and ideas makes it easy for people who don't like to deal with choice to find a couple of good things here and there. But it doesn't particularly foster the best creativity or ideas, only the easiest to market. It doesn't make the world a better place, it only makes shareholders and CEOs richer.
Choice is good, but it does take effort to appreciate.
As the parent acknowledged, in some cases amateur stuff is as good as or better than the pros. People have become so used to being force-fed their ideas that they can't believe that the good ones might also rise to the top in a truly free idea market. But they will - in a free idea market, without corporate sponsorship, the most visible art and ideas will be the ones you hear about most from other people, some of whom you will trust more than others. Much like internet memes, a good artist will quickly and easily become well known in an absense of corporate interest. Unfortunately, as things stand now, corporate interests drown out amateur efforts.
Re:Open-source music? (Score:2)
Oh, but it DOES make the world a better place! My time has a value. I cannot possibly listen to sample music from every artist and every album. "Music as a business" acts as a filter. By marketing it to radio stations to play, I get to listen to music samples filtered towards the "average" listener of the particular radio station. I'll most likely miss out on some really awesome music, but at least I won't have to slog through a mountain of crap just to find an album worth purchasing.
In other words, "corporate" marketing allows me to make more informed choices.
Re:Open-source music? (Score:2)
Re:Open-source music? (Score:2)
I have a close friend in the alternative music scene (he is a well known reveiwer). From what I can see, the alternative music scene works exactly the same way as the "corporate" music scene, just at a much smaller scale and to a much smaller audience. Music still gets marketed to alternative radio stations. Ads still get placed in mags. Payola of a sort still occurs. And alternative music lovers still look to the mags and radio stations as filtering mechanisms.
Re:Open-source music? (Score:2)
Re:Marxist Irony (Score:2)
If capitalism and the "free market" were truly functioning, the RIAA and the MPAA wouldn't exist.
Re:Open-source music? (Score:3, Interesting)
At the moment, if you are a pro musician, you're probably signed to someone, and so you have to do what they say. You can't get together with someone you met at a concert and do a project together unless your label approves it (which is unlikely). That was why even Eric Clapton and George Harrison played under psuedonyms(sp?) on for each others labels, so as not to infringe on the labels that owned their works.
Not every musician needs to give away their music, but I bet a fair amount would. It would sure lead to some great stuff. The cream would rise to the top (just like OSS) and we would all be beter for it.
Re:Open-source music? (Score:4, Insightful)
Open Source. Free as in speech, not free as in beer (or free as in CDs, if that helps.)
Please know what you are talking about before you comment on it.
It's not about giving it away, its about your music being trasparent. Your musician friends are Open Source friendly whether they like it or not - I can go to a show, transcibe their music, make some modifications, alter it. Now, I can't sell it, but that doesn't mean that I'm not able to know how the music was built. I can find out just by listening to it.
Compilers are like (neccessary) noise-makers
And the reason your musician friends dont give music away for free is because if anybody gave all their product away for free, nobody would make a living. Duh. That doesn't mean that they should try and prevent people from knowing how their sound/songs were built, because that kind of information is what *drives* culture. No artist has ever created anything original - art is just a history of creative "patches" to others' work.
Re:Open-source music? (Score:3, Informative)
The battles for control over sheet music at the turn of the 20th century would be very instructive for the majority of slashdotters. Until intellectual property laws were strengthened, it was perfectly legal to send someone to a musical and have them write down the music during the performance. Then sheet music publishers would buy the copied music and publish it themselves, with not a penny to the original composers/arraingers. Gilbert and Sullivan used to complain bitterly about this.
Meanwhile, in the developing world (which was America at the time), copyrights on European (especially British) content was ignored. Dickens hated America for just this reason. Remind anyone of China in the 21st century?
Somehow, the world survived the sheet music monopolies and content control system (back when content control meant hiring thugs to destroy businesses that were suspected of "pirating" sheet music), just as it will survive the RIAA, MPAA, and the DMCA. They're just going to be made irelevant by some future technological occurence.
-jon
Re:Open-source music? (Score:2)
I agree, especially with regard to classical instruments, such as piano and oboe, or groups of such instruments, as in a symphony. However, it seems less true with regard to electronic music, where the artist created a "recipe" of synthesizer or amplifier settings to get a particular effect. An electronic artist's tools may be analogous to a compiler, where the input isn't always determinable from the output.
Re:Open-source music? (Score:3, Informative)
Modularity & Open-Source Music (Score:2)
Here's an excerpt from the paper:
"This suggests that peer-production will thrive where projects have three characteristics. First, they must be modular. That is, they can be broken up into variously sized components, each of which can be produced independently of the production of the others. This enables people with different levels of motivation to collaborate by contributing variously-sized contributions, consistent with their level of motivation. Second, modules must be relatively fine-grained. That is, the smallest-grained contributions need to be relatively small, so as to capture contributions from very large numbers of contributors whose motivation level will not sustain anything more than quite small efforts towards the project. Novels, for example, at least those that look like our current conception of a novel, are likely to prove resistant to peer-production. Third, and finally, the cost of integrating the contribution needs to be relatively low. If the cost of integration is too high, integration will either fail or will force the integrator to appropriate the residual value of the common project- usually leading to a dissipation of the motivations ex ante. Where the cost of integration is sufficiently low, or where integration itself can be iteratively peer-produced, as where free software is used to integrate the peer-production effort, integration need not appropriately the residual category, and the peer-production enterprise can succeed and sustain itself." (page 8)
So the three requirements are modularity, fine-grained smallest modules, and low cost of integration.
Organizing communication by topic, like on Slashdot or K5 clearly meets these three requirements. DMOZ clearly meets the requirements. Free Software projects clearly meet the requirements.
Music production, however, does not.
Making music modular is difficult. Sure, music comes in tracks, but those are hardly fine-grained modules, and they are very tightly coupled- so tightly, that I would say that they are a cohesive unit, and not really modules at all.
This is the same difficulty with novels, alluded to before.
In the far future, we may have a modular description of music and novels,. Imagine that you paint a novel with a toolkit of styles, characters, events, messages, etc.,. I think it might be possible, but I also think that's a looong ways off.
Re:Open-source music? (Score:2)
> different musicians contributing riffs and lyrics and vocals and whatnot to create songs
How do you think music is made? Do us musicians just pull ideas out of our ass? They are tiny modifications, changes to other hooks, melodies we've heard. Some are so obvious, critics' can identify a musical 'top of the hat' to other musicians in their recordings. Musicians dont have to sit beside eat other to contribute riffs and lyrics - they do by listening to other musicians and generating ideas out of them. Music (culture and art, for that matter) IS one huge open-source collaborative process.
> most professional musicians would want to control every creative aspect of the songwriting process
s/most/some. Thats a very broad generalization that does not hold up a lot of the time.
Re:Open-source music? (Score:2)
>Of course artists have influences, but they don't actively contribute to each other's work.
But thats not true.
I see what you are getting at, but given that a body of artistic work has no formal scope, it sounds to me like you're saying, "I like to work from point A to point B. Then I will open it up for reinterpretation because I understand that culture doesn't work if we cannot borrow or rephrase or ever restate what has been said before." (Which opens up an interesting point - simply because language space is a finite size, one MUST be able to accept ver-batim copies of one's work simply because there is a fixed amount of resources with which to create.) Working collaberatively on the same song can happen in the exact same way except instead of point A being the start of a song and point B is the end of a song, they are points within a piece of work that will be born from said collaberation.
It's almost like a mandlebrot set. You can zoom in and zoom out on the scope of collaberation - at what point is it OK to start borrowing or contributing to the creation of bodies of works, whether it be a few measures, a song, or an album? I think thats a purely personal decision that should never be formalized in such a way that it must be applied to a social body of artists, which is why your statement about what artists like in terms of control seems like a very dangerous claim to apply to the artistic community at large.
Sorry about the tone in my reply above, its just a hot button issue for me that artists are this, artsits are that. Artists make their living from creating seemingly new things, so to place constraints or generalizations on how they do/must work is tantamount to destroying what they need to create in the first place. It wouldn't be creative if we knew exactly what was needed to get there in the first place.
Open Source Music??? (Score:3)
Investing in OSS (Score:3, Interesting)
A very good read, and it supports the partnership that VA and Forbes have made.
Economist Article (Score:3, Informative)
Economist Article misses two points (Score:2)
Communism at work? (Score:2)
It's what always seemed to me flawed with other (arguably) noble Communist experiments, like the Soviet Union. Specifically, that all citizens were forced to participate in this system, in effect with a gun to their head. (You will help! We will be happy, dammit!) Over-simplifying possibly
Given that volunteers to an Open Source project are just that: volunteers, it seems possible that these projects may come much closer to the spirit and the ideal of communism. So the article seems optimistic and hope-ful. And very cool.
Just my $.02--
Re:Communism at work? (Score:2, Interesting)
Even in the Open Source world, most developers don't write programs for the good of mankind but to scratch an itch, to show that they can be better than closed source software or for the fun of it. And most users usually give a damn about the free speech aspect, they only want to get really drunk hard with the free beer.
Re:Communism at work? (Score:2)
You have to look very closely at the differences of, let's call it "Physical World Communism" (PWB) vs. "Software Communism" (SC), where the latter shall be a crude way of naming the communistic elements you and your parent poster linked to open source ideas. We'll accept the word communism, while I think marxism would be more appropriate.
"So people tend to press everything they can out from a system that allows them to do it while trying to contribute as less as possible."
In PWC, this is a very real problem and is perhaps indeed the main point why such systems won't fly. The effect is that "bad" people consume more resources than they create, taking from the resource pool and shortening resources also of the people who create more than they consume, therefore accelerating the effect of people getting "bad". IIRC there are classical examples from game theory/psychology for that.
OTOH, in SC, it is not so simple to define resources. At least not a resources with the property that you can reduce resources by taking them from the pool. The closest thing that I can think of is "developer time", but the trick is the this resource doesn't follow communistic ideas, it strongly follows the ideas of individuality. Examples are project forks, developers dropping out of projects, etc. - things that happen daily in open source.
Usage of OS software doesn't reduce any resources of SC, therefore most freeriders in this "software communism" scheme do _not_ hurt the system.
Now we can look more closely at the resource "developer time", and this is IMO where the differences between BSD-style licenses and GPL come into play.
BSD-style licenses are in danger of resource exhaustion because a proprietary fork might "steal" mind-share and therefore indeed reduce said resource, but most projects using such license rightly seem not to be concerned about that.
The problem gets worse if there is more then one party involved which could profit or profits from proprietary derivatives from an BSD-licensed project, because all of a sudden there exists a new resource pool (income by selling the product) which makes it attractive to withhold from sharing resources. An example [slashdot.org] for this can be easily found on your favorite ews site.
The way which GPL tries to resolve those problems is known, and looking at the sheer number of competing companies contributing to linux suggests that it may be quite successful.
Oh, and btw., it is not suprising that something like OSS has emerged, IMO it is the best existant model for something like software, where resources are set up like I described above. What I find suprising is that one must always explain that it is the best, although nearly the same model is used in sciences/engineering very successful since their existance.
Re:Communism at work? (Score:2)
Aaaargh!! Cooperation is not communism! Aaargh!
Re:Communism at work? (Score:2)
The "englightened" part of all this is where you realize that there are other forms of compensation besides monetary. Having a good environment in which to make and spend your money can entail making donations to civic organizations in the form of money and/or time. It can probably entail a large number of things that I'm not thinking of at this very moment, none of which gives you direct monetary compensation.
The point is, you have to have a balance. The pure greed/self-interest/whatever you want to call it of a completely open market is, in my opinion, clearly not the optimal social environment. You have to balance some socialistic seeming institutions with some capitalistic solutions for everything to work. I think the point about voluntary vs. mandatory is really key in how you strike that balance too.
Re:Communism at work? (Score:2)
Re:Communism at work? (Score:2)
The best part about OSS is that it can't be used to restrict the freedom of others, and that it can't be corrupted as easily as Communism itself. Human nature shows that Communism often becomes a dictatorship, but it is hard to see how OSS can become proprietary software.
I dunno. Maybe you could make that argument for the BSD license, but not for the GPL.
Proprietary software limits the user's freedom. BSD license doesn't limit anyone's freedom, including the vendor's freedom to limit the user's freedom. GPL preserves the user's freedom, but limits the vendor's freedom to limit the user's freedom.
You can't give everyone absolute freedom (and enforce it) because one person's freedom to do X is always going to conflict with someone else's freedom to do Y.
-a
Can you imagine... (Score:3, Interesting)
I remember reading/using an official music book that had the all the songs ever recorded by Stan Rogers (a Canadian folk musician). In his forward, he said feel free to learn these songs, and play them as you want, in the great tradition of folk music. He even ended with if you find a better way to play them, let me know.
I hope the OSS model does in fact become common-place in other parts of culture and public works.
Re:Can you imagine... (Score:3, Informative)
Indeed, I can imagine that. These were my ideas [theoretic.com]
I got quite a long way with it - on that page are ideas for how such a musical marketplace could work, how quality would be ensured (ie how do you sort the wheat from the chaff without record companies A&R depts) and answers to questions musicians would commonly have.
I can so see this happening. Music is, in a way, a parallel of the software world. Music is effectively information and can be replicated and copied for zero cost. It's dominated by a rich and powerful entity (the RIAA vs MS), and the world is crying out for something better. It's ripe for the gift economy to be established here.
Re:Can you imagine... (Score:2)
This is Market Economics, plain and simple. (Score:3, Insightful)
Open source is the definition of Market Economics. It does not need its own theory- it proves the Marekt theory in the most divergent context imaginable.
If you have an idea and you open source it, you get free engineering. People contribute their engineering and get the utility of yours and others in response. This is a free exchange of value in a free market.
IF your terms suck, or you change direction in mid stream, the others are free to leave your project and start their own, or go along with you if they like your direction.
Linux is a consistant linus kernel because people like linus's direction-- not because he "owns" it. That is direct market feed back to linus.
If you are selling your product to people who are contributing nothing but money to the process, and are just using it, then you are in the traditional software model. but Open source works here as well-- you can incorporate open source into your product and leverage others work to make more money off of your work. At the same time, the MARKET FORCES (not the GPL) will force you to contribute your improvements back to the community. And finally, you're not profiting unfairly from others work because the others contributed freely, and were compensated... and also can sell the results in the market place against you, so if your product is PURELY reselling open source, then you'll loose the inevitable price war-- its hard to beat free.
If, however, you actually add value to the product, on top of the open source, then you CAN charge for that value and everybody wins-- your customer gets a better product with more features and testing than you could otherwise do yourself, the other os developers get the benefit of your improvements and you get more money for selling a better product that cost you less to develop.
This is all free market economics.
The differnce between open source (free market) and communism is that under communism you are forced to work for the state against your will. Here in america, we are %50 forced to work for the state against your will, but they cleverly let us work for private companies and only took the product of half our work in taxes (fees, etc. And yes, last time I did my taxes, my total payments to the state were over %50, and I'm in a medium tax bracket.)
Even with the GPL, however, you are not compelled to work for the "State"... you can choose to not use the GPL for your code, or go make code to replace whats' in the GPL, or just use the gPL code and not change it. ITs a free market of licenses.
Since the government isn't (Yet) regulating software, the emergence of the open source movement proves that free markets work-- whenever one company gets to monopolistic, under free market theory, competitors emerge. Lots of competitors have emerged to Microsoft, but Open Source is the first one to really sustain a battle and change the terms of the war.
As long as the state doesn't mandate Microsoft control (As they may wit palladium) the free market will prevail and the products that offer the most utility value will succeed. For a long time Microsoft was able to distort the market with anti-market means, and also provide sufficent value to have locked up much of the market--- a great example of the market under a lot of stress.
But the emergence of the free market, the resurgence of a variety of MS competitors- from Sun to Apple to IBM to me, shows that the free market does work-- even with the governments help for microsoft, the market is beating them.
Not financially right now, but in terms of brainshare and technology, MS is currently loosing. In order to win, or even survive, they will have to deliver better value for their prices... and since open source software is free, the competition is stiff.
So, no, there isn't a new theory needed-- The Free market works and has been validated, yet again, by opensource. (So stop voting republican or democrat and become a libertarian already.)
Re:This is Market Economics, plain and simple. (Score:2)
I would hate to know what you were doing to get taxes that high. The average family in the United States pays between 20-25% of their income to taxes.
Of course your pro-libertarian rant left out many of the complexities of the marketplace that cause free market economics. Namely, you left out the ability of consumers to obtain accurate information, and the strong anti-competitive pressure that a network effect can have. As we have seen from recent corporate scandals, consumer often have a very hard time obtaining accurate information about products they would like to purchase. Microsoft is a very good example of this. They can spew FUD with the best of them, and their misinformation machine will cause consumers to purchase items which are not actually in their best interests. Also, the network effect of economics makes it so that many people won't want to switch to a operating system that other people are not currently using, because the OS doesn't give them the value that it normally would with an increased number of other users.
Re:This is Market Economics, plain and simple. (Score:2)
THis is simply not true. The average family pays that much in INCOME TAXES ALONE. When you add Sales taxes (%8) car taxes, STATE TAXES (say %10), gas taxes, Social Security (%16) Medicair (dunno) you easily get to %50 for the average family.
Hell, add sales tax and social security to %25 and you're already in the %40... not including the property taxes you have to pay and the phone taxes you have to pay (%12 roughly), etc. etc. etc.
Pretending that income tax is the only tax you have to pay is dishonest.
s we have seen from recent corporate scandals, consumer often have a very hard time obtaining accurate information about products they would like to purchase.
I love it how leftists consider "Fraud" to be the natural state of the freemarket.
FRAUD IS FRAUD. It is illegal, and thus the only question is if it is being prosecuted enough.
And, as I pointed out, even despite the Microsoft effect, the freemarket is beating them. Not financially yet, but technologically and mindshare wise. Non-MS operating systems are the fastest growing, and apache seems pretty stable with over %50 marketshare. Did you just not read that part?
Sheesh.
Re:This is Market Economics, plain and simple. (Score:2)
So, there is no justification for taxes? There's no value delivered for them?
I think you just made my point!
Something like social security is a charge for later delivery of value.
This is as true as paying a slot machine is investing for future delivery of value. social security is bankrupt, and it is irresponsibly run-- you are never getting your money back, and what money you MIGHT get back is far less than what you have put in.
You can go buy private annuities that pay out like social security, the only difference is that they have to be honest with the money (no dipping in and spending it on toys as the government regularly does.) Social security is essentially a fraud.
Taxes are a way of collectively charging a population for collectively received benefits. It is not an inherently coercive method of finance.
Except that it is BY DEFINITION coercive. You don't pay, they force you to. You refuse, they put you in jail. You resist arrest, they have guns.
Taxes are the forced extration of value from people against their will, and NOT TO THEIR BENEFIT. Ok, so you get some benefit, but that is a tiny proportion in value to to the taxes you pay.
By the way, who said only the government could provide armed defense, roads and other services? Any private company could provide these things, or privately entered groups of people.
Everything the government does it does incompetantly, or at inordinant expense for the value recieved.
That they do deliver some trivial amount of value does not justify all of the taxes, only a trivial amount of them.
The rest is theft. Theft at gunpoint.
Re:This is Market Economics, plain and simple. (Score:3, Insightful)
It might be *possible* to describe the Open Source movement in terms of standard market forces, but it is not parsimonious.
I wonder whether you've read Benkler's paper. It's long, and as he says, he spends "substantial space in this article explaining why peer-production processes appear to respond mostly to cues other than price signals." *That* is clearly one aspect that removes this from the realm of market forces. If you want to argue tautologies about how people always do what's in their best interests, etc., go ahead. But you're not describing standard market economic models unless actions are motivated by profits and regulated by prices. Free-as-in-beer software may be used by some companies to save money, but that's not why most programmers create it.
"[T]he emergence of the open source movement proves that free markets work-- whenever one company gets to monopolistic, under free market theory, competitors emerge. Lots of competitors have emerged to Microsoft, but Open Source is the first one to really sustain a battle and change the terms of the war."
Are you serious? This proves the opposite. It proves that in an unregulated market, monopolists can emerge that can't be dislodged by any competing firm. Only people who are not motivated by profits have a chance, and only by creating a product that has zero marginal costs (digital data) and zero price. Those assumptions overturn all of the first chapter of Econ 101.
Market forces do not explain all aspects of human behavior. Why do some libertarians get so defensive when that's pointed out?
Re:This is Market Economics, plain and simple. (Score:2)
The error you, and many others make, is confusing "prices" with "Value"
Free software has value, even though its free.
To claim that the free market is only about pricing things in terms of CASH is false. Pricing includes value, and everything that goes into a transaction-- labor, for instance.
By your theory, every worker is getting a free ride because they put no money in and get money out.
Free Market Economics is not about pricing of cash, its about pricing in terms of value. To pretend that "only profits mater" to people is stupid -- a huge profit is pointless if you end up in jail, and thus fraud is rather rare in a free market economy.
Monopolists MORE OFTEN emerge in regulated markets-- the government creates them. YEs, in an unregulated market, they can emerge, but tehy cannot survive for very long.
To say that people developing open source software are not motivated by profits is to lie-- either about them, or the definition of "profit" which is to "receive value"... Things other than cash have vale- even to capitalists.
Re:This is Market Economics, plain and simple. (Score:2)
A basic proposition of Economics is that everything of value is convertible into cash. If I want to take time off from work and go to the beach, there is an implied calculation I make about the dollar value (as lost income) to me of that day at the beach.
That's still a very kludgy theory, because research shows people don't really make decisions that way. And when you get into free software, standard theory becomes almost impossible. Without pricing signals from either buyers or sellers, you cannot make economic statements or predictions. In fact, you might asymptotic behavior at $0. How much money will it take to get Linus to stop work on Linux? Possibly an infinite amount. Because what he values is *not* fungible to cash.
Re:This is Market Economics, plain and simple. (Score:2)
Exactly, you just made my point, not disputed it.
This "basic proposition" you talk of does NOT EXIST. Its a basic proposition of many leftists...
But economics is about value, NOT CASH. People are not failing free market theory when they value things other than cash! That's just propaganda and spin to try and undermine free market theory.
The pricing of free market theory takes these non-cash values into account. People pay more, for instance, for a hotel room where they can get peace and quiet-- they are not getting physical return for that extra investment, but they ARE getting value. So a cabin by the lake is not "gouging" people as leftists would say, nor are people ignoring efficient market by paying more for a smaller room. They are just valuing the peace and quiet.
That value exists only in cash is the falsehood I'm fighting.
That someone will exchange something (like labor) that can be exchanged for cash for something that is "free" (like linux) only supports my statement. but it also supports the "cash" position in that labor is a form of cash.
So, either cash is everywhere and nothing is free- not even linux-- or you include any form of value as value (and linux is still not free.)
Re:This is Market Economics, plain and simple. (Score:2)
Economics is not about monetary profits and prices. One recent example that most geeks should relate to: The movie "A Beautiful Mind" showed John Nash receiving the nobel prize. In the movie he discovered the key to this theory while analyzing how guys pick up chicks. It was a funny scene, but it was pure economics. And no market prices or monetary profits anywhere to be seen.
People acting in their best self-interest may be a tautology, but it is the tautology that ecnomics is based upon. The reason why so much "popular" economics emphasizes money is that money is much easier to measure than than other things that human beings value.
Re:This is Market Economics, plain and simple. (Score:2)
That was an example of Game Theory, not Economics. (One difference being that Game Theory creates a tiny, artificial world, with heavy constraints and no currency that can be used to exchange different forms of value in spheres outside that world. In the Prisoner's Dilemma, you're not 'allowed' to create a third alternative, like making a prison break.)
Of course, there is the problem that economists don't even agree on what falls in their field, because to do so illustrates the overreaching and unscientific claims upon which it is built. For example, I recently checked out 10 different Econ 101 textbooks. Half of them gave vague definitions, and the other half said quite plainly that "we're not going to define economics; it's easier to just look at the subjects covered in this book."
The main question here is "can conventional economic theory explain the free software movement?" Now look again at "A Beautiful Mind". The "conventional theory" about getting girls was the "survival of the fittest" contest, as one character put it; everyone goes for the prettiest girl. That is HOW all characters except Nash actually acted! That theory described actual behavior very well; it's just that Nash's theory suggested a more optimal global solution. Similarly, people creating free software are motivated by their own, non-market theory of what they should do. Unlike companies, they were not making market calculations.
An economist would now say, "watch what people do, not what they say." Meaning that although people don't think they're motivated by market values, they are. Or rather, it's still possible to view them that way, and gives economists a chance to bend the model to encompass them. But in a sphere without scarcity (digital data), and with $0 prices, how can market theory improve the "efficiency' of free software? You already have an answer to the question of people's motivations, and without a scarcity problem or a fungible value system, economists have little to offer here except distortion of motives.
Re:This is Market Economics, plain and simple. (Score:2)
Much of economics is game theory. In some ways, economics is really applied game theory.
But in a sphere without scarcity (digital data), and with $0 prices, how can market theory improve the "efficiency' of free software?
There's a whole list of economic study topics just waiting to be explored in this area. First, there is a scarcity of programmers. Why does a programmer choose to contribute to one project but not another? Second, there is a scarcity of distribution channels. How can Cheapbytes and Linuxmall get away with charging $2 a CD when there is no scarcity? Why do I maintain subscriptions to FreeBSD and Slackware Linux when I can download them for free?
Re:This is Market Economics, plain and simple. (Score:2)
Why do I maintain subscriptions to FreeBSD and Slackware Linux when I can download them for free?
What is relevant is (Value(Subscription CD) - Cost(Subscription)) versus (Value(Downloaded CD) - Cost(downloading CD)). Same reason I buy RedHat Office Professional and use the first two (now three) CDs.
Would the value of your subscriptions be worth more or less if downloads were no longer free? Personally, if RedHat stopped the free downloads, I'd be looking for a different vendor.
Re:This is Market Economics, plain and simple. (Score:2)
If you want to argue tautologies about how people always do what's in their best interests, etc., go ahead. But you're not describing standard market economic models unless actions are motivated by profits and regulated by prices.
To put it another way, "free market economics" does not describe all human behaviour, but Game Theory does. In game theory you are more likely to describe rewards and costs in terms of points, but it is easy to equate "points" with dollars. In game theory, free market economics rules because everyone acts in his own best interest, but altruistic behaviour can still emerge (you just have to assign a point value to that "warm fuzzy feeling").
Are you serious? This proves the opposite. It proves that in an unregulated market, monopolists can emerge that can't be dislodged by any competing firm.
Exactly. OSS fits the definition of a monopoly as far as I can tell. Selling software below cost is predatory pricing. Forcing the software to be free as in beer is price fixing. (The Stallman argument that you can make money by selling free software is laughable.)
Someone once posted on Slashdot by stating that OSS was a free market force and they had the nerve to state that "Adam Smith would be proud." For the record, here is what Adam Smith actually said: A group of people actively coordinating an economic revolution is not an invisible hand.
-a
Re:Critical error... (Score:2)
>> monopolists can emerge that can't be dislodged
>> by any competing firm.
>
> The problem is that our market is hardly
> "unregulated".
All right, let me restate my point: in a market where ownership of standards can create network effects (e.g., videotape formats, or OS's), failure to enforce existing antitrust regulations can allow a monopolist to gain such power that no other profit-seeking competitor can threaten it.
Can we agree on that?
Re:This is Market Economics, plain and simple. (Score:3, Insightful)
Yes, classical liberal economics (the a priori discipline) encompasses open source, and explains its success quite well; but at the same time, there are broad financial models within that discipline which fail to explain open source, even though open source has financial consequences. This paper examines open source with the intent of fitting it into some of those models.
I'm using the term 'economics' to describe the science which examines the results of human actions and choices, while 'finance' is the subcategory of that which examines only intercomparable human actions and choices, and which uses money as the instrument of comparison. A better choice of words would be to use 'praxeology' for the first term, and 'economics' for the second.
See von Mises' text 'Human Action' for MANY more details. In that text he covers praxeology in general and economics in specific. Highly recommended, and available as a free ebook on mises.org.
Oh, and although Mises is the poster child of the Libertarians, he wasn't one and couldn't have been one (there weren't any at the time). So check your prejudices at the door. A lot of what he says is valid even under non-Libertarian assumptions, and much of the rest is valid as long as you don't try to apply it too far (as most Libertarians do).
Note the big L -- I'm a libertarian, but I'm not a Libertarian.
-Billy
Re:This is Market Economics, plain and simple. (Score:2)
My only prejudice is to figure von Mises is worth reading.
I know of no difference between Libertarians and libertarians. Except that some people calling themselves libertarians are idiots, but that's to be expected. There are even objectivists who support Microsoft (thus violating objectivist morality.)
That people may have built financial models that don't account for open source is not an issue-- it simply means that the models may not be correctly applied, and are appropriate only to situations where value is only represented by cash. Hence using the word financial is appropriate.
But the free market is a free market of value (not cash), and open source fits right in. And that was my point.
Re:This is Market Economics, plain and simple. (Score:2)
Well... you imply that no people calling themselves Libertarians are idiots, which is false on its face. I won't attempt to compute a L/l idiodicy ratio, but I will laugh at the thought...
But the free market is a free market of value (not cash), and open source fits right in. And that was my point.
This nails the fine distinction the author of the original paper was making. He lists two expected motives for participating in a project: 1) their boss told them to, or 2) someone offered them money to.
The full scope of the free market is much larger than that (as you state), expanding in general to include me doing something because I judge that the benefit to be gained from doing it is higher than the benefit to be gained by doing something else (including doing nothing).
In other words, his definition of the "market" is an older, more restrictive one (as you'd expect for someone basing his work on a 1930 economic work). Mises' definition includes his, and is in fact much more useful -- but his is nonetheless a valuable subcategory of the market, since it forms the basis for a theory of business growth.
So essentially, his paper does what his abstract says: it fits open source into a theory of corporate growth, thereby producing results which attempt to predict and evaluate data on project size.
I'm still digesting the paper as a whole, but so far it seems quite good, neglecting the terminology error of mistaking the "market" for a small subset of the market (I think we could more accurately call his so-called "market" the "cash-up-front demand market", since it's based on someone offering you a fixed amount of cash).
It's interesting that he also misses a major group which IS outside of the market: bureaucracies.
-Billy
Re:This is Market Economics, plain and simple. (Score:2)
I wasn't meaning to denigrate the paper. I was expressing my opnions, which I expect are along the lines of the paper--- I just think that the problem is too many people think "free market" is all about money and that there is no other from of value. (I call these people leftists.)
I thought I said there were idiots calling themselves libertarins. That I find no unlibertrian points to the Libertarian platform, does not mean that all those calling themselves Libertarians are really so, (and not idiots.)
We can debate the relative percentages of idiots calling themselves all kinds of things, but my main point in responding is to say that I am not disputing the paper, I'm merely saying that it shouldn't be that radical of a finding.
Its only dispelling something that was poor thinking to begin with.
Re:This is Market Economics, plain and simple. (Score:2)
This is true.
And when the software provides better value compared to closed source software, the market moves in that direction fairly quickly.
Linux in the server space and Apache are great examples of this. We've come a long way in 10 years.
The free market encourages both to exist, and values them fairly, based on their utility value-- it really isn't an "either or" situation. both models will continue to succeed.
Proprietary software has to quickly move to the innovative areas and get out of the commodity areas... because open source will quickly take over anything that is commodity software (such as OS, web servers, web browsers, and eventually, OFFICE Apps) IF you want to charge cash, you provide extra value to justify it.
Where the zero marginal cost of software has the most impact is in the broadest areas-- which become commodities. Things like high end compositing engines, will continue to provide value that is difficult to duplicate for some period, and then they will become open source.
But the free market model covers all of this if you think in terms of value, not cash. The problem is so many are so anti-hum^H^H^H corporate that they have started to think that profit is a four letter word.
When profit is what we all do when we use and support an open source product to greater benefit than its proprietary counterpart. And when we use proprietary products to solve a problem that was expensive and previously unsolvable, we also profit-- our productivity goes up even though we paid for the software when we weren't before (Because it didn't exist.)
What is the publication stardate? (Score:2)
-Peter
little insight (Score:2)
I would even argue that isn't a main motivation.
Motivations to go open source:
1. Get your name out there
Something to put on a resume, a way to build relationships with companies who may later hire you.
2. Other people do some of the work
Whereas freeware might get your name out there and satisfy the first advantage, it does not allow other people to help you debug and build the work very much.
3. Makes money through contracts
Many people contract with open source developers to add features or fix specific bugs that have lingered. This benefits the company which spends way less money than on the closed source alternatives, and also benefits the programmer, by letting them take 100% of the money rather than some corporation only giving them a fixed paycheck. This 100% performance based reward system creates a very efficient marketplace. The programmer also generally gets to keep ownership of the added code, which is a plus.
Anyway, my point is, one doesn't have to believe in anything but selfish motivations, and old fashioned rational economic behaviors to see that open source is win-win for everyone involved.
I believe what he is saying...wrt coase. (Score:3, Insightful)
So if one can call, for instance, the Linux kernel folks a firm, their fixed costs are fixed, but their marginal costs are zero. (barring Linus's scaling issues of course).
Marginal costs being the added cost of each extra unit of "firm size".
So organizations will scale to be quite big over the 'net because of low marginal costs.
And this is what we have witnessed.
I hope the paper has graphs. I like graphs.
-b
We're about to recieve a major whomping of irony.. (Score:3, Interesting)
Which can only mean that asteroid will hit in 2019. Oh well, still 17 years left to party...
Same ol' economy, new face. (Score:4, Insightful)
Software, Music, Movies, Books, etc. Are all money makers based on the fact that they can mass produce a product that people will pay for. On an individual basis, the $16 or so made off of a single CD, book or movie doesn't matter unless they can product millions of these $16 products and sell them.
With the internet though, it has opened the possibility of distribution of IP products for free or near free prices. Thus the business model of these IP companies is not applicable anymore without forcing the public to play by their rules by legislating laws into place.
The Open Source Movement has a weird effect of showing what happens when people can produce the same products and share it with everyone else, allowing them to improve on it. Before hte internet, when I coded a small program I could only share it among my close friends easily. Now I can share it with everyone, and if it is useful, everyone can contribute to it.
In a way it is like the folksongs from way back. Somebody thought it up, and shared it among his friends and family, or in performance, thus making his money from his actual work and not a 'photocopy' of his work. Then other musicians got it, and would play with it, producing even better music. Some of the great classical pieces are basically open source folk songs that have been improved upon by the masters. Since folk songs could easily spread by word of mouth, and didn't cost anything to spread, these songs became the equivalent of Open Source Music. Everyone was able to enjoy it, and no one had to pay anyone for the right to hear, see, learn or play the song themselves.
Now, we can pass programs, books, poetry and more using the internet and allow others who may be better (may be worse) then us to improve on them and create a better product in the long run. It's not a new economic model, it's just an old one coming back in a new form.
I heard once that people don't like change, they like things to remain the same as long as possible. I think it would be more correct to say people with power and money don't like change, and will go to great lengths to prevent it.
Some interesting thoughts.
Re:Same ol' economy, new face. (Score:3, Insightful)
- Obsolescence of classical distribution channels
This is indeed the problem of big media corporations and covers the distribution of the good itself and marketing logistics. The importance of both of them has suffered quite a bit since the internet emerged. I venture a guess the the biggest fear of big media might be not the fact that people can copy and distribute their stuff, but that artist in the long term will loose their dependence on a company to get their stuff to the people.
- Collaborative work on an open source product (whatever it may be).
I think the latter mainly will affect software production, because the process of creating "art" does not inherently profit from collaboration. Would Bach's work really be any better if he had done it with a couple of fellows over the internet? Would it really improve if someone took it and came out with Toccata & Fuge 1.1?
This would be possible today, because there is no copyright etc. on Bachs work, but nobody seems to think it's a good idea.
Re:Same ol' economy, new face. (Score:2)
but cannot another artists _interpretation_ of Toccata & Fuge 1.1 be considered improvement. The basis is still there, and it is still the beautiful classical piece. But each artist has the right to play it as they wish. Add a staccato here, a fortissimo there. They all have the right to improve on the general piece. Even some modern jazz, rock and techno artists have taken these pieces and adapted them to their own style of music making them their own. In a way working on a open-source piece of art.
I remember picasso's quotation, "Good artists innovate, Great artists steal." (I think). Perhaps it is not stealing as much as taking an idea that is good and attempting to improve upon it so the final product is potentially better.
I know when I hear Toccata & Fugue by the Montreal Symphony Orchestra, it is a much different feeling then when I hear it performed by the Edmonton Symphony Orchestra. I know that I have heard many interesting takes on Ode to Joy by Jazz Artists and Techno musicians.
Perhaps Art can be open sourced afterall.
Re:Same ol' economy, new face. (Score:2)
So, there are no hard borders, but I don't see anything in music which is analogous to apache 1.3.18 -> 1.3.19.
But let's take a short trip to reality
My point still stands that despite Toccata & Fugue being open source, the world still waits for the 1.1. version
And, by the way, there already are certain exceptions in copyrights concerning art, they even extend to trademarks, which at least are allowed to be "violated" by satire.
Re:Same ol' economy, new face. (Score:2)
It's common for University students and other music artists to take a piece of "open-source" work and adapt the general theme, chord progression, etc. to another piece. Perhaps the only reason we don't see a Toccata & Fugue 1.1 is because no one who dare call it such a humourous name. Instead, they call it something that would fit their own taste. Even though in the end it is the basically the same base.
Perhaps all music has developed this way. Taking a piece, modifying it somewhat, and calling it your own. 'cept nowadays, unless you work for the big companies, you cannot take any part of any piece and use it in your own because you would be breaking copyright. (There are artists who have used the same chord progressions and have been sued for it.)
Maybe, The 1.1 is out, perhaps even the 2.0 is out. It's just that the artists who wrote those pieces wouldn't dare call it T & F 1.1 or T & F 2.0.
An interesting thought.
I do like the fact that we can satire pieces of copywritten material, even though we can't do much more. (Maybe we should just make a big joke Windows system that's open source, and full of satire.
Re:Same ol' economy, new face. (Score:2, Interesting)
This does actually happen in the music industry. A recent BBC radio documentary pointed out that the Beatles and the Stones based a lot of their early music on American Jazz (and even recommended the original recordings to audiences).
The questions that arise from this are;
Should people like Muddy Waters have received a share of their income ?
Why has no Open Source based business broken through to the kind of success enjoyed by those groups ?
Re:Same ol' economy, new face. (Score:2)
You can't say "Beatles are better than American Jazz", but you can say "linux 2.4.18 is better than linux 0.9.9".
No matter where you look, open source developement is directed, with only small perturbations.
Can we really say that of music? Where is the uber-musician, standing on the shoulders of giants like Mozart and Bach, creating things they never have dreamed of?
Noel Gallagher? (amusing little on-topic sidestep [sky.com])
And that's why I think that the "development" in music is not comparable to that in software, the benefit from copying (in a non-negative sense) is much more untangible, therefore less profitable, and in consequence of less value.
Re:Same ol' economy, new face. (Score:2)
Would it really improve if someone took it and came out with Toccata & Fuge 1.1?
Hang on, in't that exactly what Emersen Lake and Palmer did? They did an interpretation of Toccata and Fuge, and I think, release it as 'Toccata'.
It got alot of air play, and was pretty good. Some poeple would have called it an improvement (a lot of my friends at the time).
on Bachs work, but nobody seems to think it's a good idea.
Well, *I* thought it was a good idea, and so did EL&P's record company.
Hmm... maybe it was just too long ago, and you kids can't remember anything before rap.
Re:Same ol' economy, new face. (Score:2)
While many of your friends would have called it a straight improvement, IMO this is only acceptable in the sense of "a interpretation which fits my taster better". Many others would not say it's an improvement.
Contrast that to the example linux 0.99 vs linux 2.4.18. Is there really anyone saying that 2.4.18 isn't an improvement, even in the original meaning of the word "improvement"?
Hmm... maybe it was just too long ago, and you kids can't remember anything before rap.
Heh, let's get that outta way, my UID is lower and I know at least one other big adaption of EL&P of a quite well known classical piece, which is btw. older IIRC.
No Need To Turn Economic Theory Upside-Down (Score:5, Insightful)
There's no need to mess with economic theory to explain Open Source. There's nothing new there. Each programmer, as a rational operator, contributes for a number of possible reasons. For example, they may value creative control and consulting opportunities more than they value a salary. In other words, someone who waits tables at night and codes for free during the day isn't necessarily a radical leftwing crackpot--as long as they are doing it for the future hope of consulting $$$ and/or the right to maintain control of their work (witness the not insignificant number of people who have un-Opened their work).
Corporate sponsors have rational reasons too. IBM doesn't support Linux to join the lovefest. They think it's better for some applications, they want to offer consulting for it, they don't like being tied to a proprietary vendor, etc. Any contributions they make are made because they realize it's the price of doing business under the Linux model--they would lose business due to bad PR if they didn't.
As for software being "special", there isn't any need to appeal to such an idea. Coffee is a good example. Generic not-so-tasty coffee is often given away in waiting rooms, hotel lobbies, places like that. Same deal with those little mints on pillows. Same deal with free samples at the grocery store (I've known people who make a meal of free samples on Saturdays at Fresh Fields). In all of these cases, software included, there is a rational economic model that has given rise to support for some free riders. People still have to pay for these products. The payers have deemed that they are better off paying the free riders, much as society has decided that some taxation is better than none.
The OSS model could be regarded as a "natural tax". Once again, there is nothing irrational about it. Advocates just have to realize that neither model is "superior". The free market sometimes moves us towards paying for goods directly. Other times it moves us towards indirect payment (somebody pays for OSS, because TANSTAAFL).
Of course, I doubt that advocates will stop advocating. There is a demand for politics just like anything else, and they supply it. It's just that I hate to see it when the supply-demand for politics pushes the supply-demand for other things out of equilibrium.
Re:No Need To Turn Economic Theory Upside-Down (Score:3, Insightful)
No one is "messing with" economic theory. Benkler isn't saying that traditional economic theories are wrong. Just that they're not sufficient to explain a newly witnessed phenomenon: Open Source/Free Software.
I provide free software because I have no reason not to. I don't provide it for the hopes of some future consulting dollars. I don't provide it because I wish to maintain control of my work. I use the GPL because I don't want someone to take work that I've already done and make me pay for it in some slightly different form.
For Microsoft and Sun and ..., they only reason they produce software is to sell it. They're not actually concerned about using it to solve a problem that they are experiencing. They're not scratching their own itches. They're guessing at the itch that someone else has and trying to produce a backscratcher that will reach. But for me finished software is simply a scratched itch. I do NOT look at it as an oppurtunity to sell a backscratcher to others with the same itch. If they want it, fine. I've already solved my problem.
But if you want to get some idea of what I really want by releasing my software, it's this. I want access to the backscratchers that others have produced. But not only that with the ability to easily modify their backscratcher to reach my specific itch. This economy is not measured in dollars. It's measured in software, and that, I think is the point of Benkler's article. If you try to measure open source/free software using the traditional mechanisms, you're going to have to start looking for the money. For the *vast* majority of people who produce open source/free software, their just isn't any money involved. (IBM, Red Hat notwithstanding. They provide lots of opensource/free software, but not anywhere near the majority.)
So Benkler is just saying that there are other "enlightened self interest" factors that are involved. Not just money. Since all of the traditional economic production models have centered around money, they're not sufficient.
Re:No Need To Turn Economic Theory Upside-Down (Score:2)
You are minimizing what I'd call the "hassle factor". It's possible to put some sort of monetary value on free software, but it's a lot of work to produce rather poor numbers which are misleading at best.
The "enlightened self interest" does not apply to just Open Source software. There is such as the American Petroleum Institute where the major contributers are mostly really helping their competitors.
Re:No Need To Turn Economic Theory Upside-Down (Score:2)
Now consider OSS. People play around with it, doing whatever they feel like doing. Getting a program or a feature working is as satisfying as solving a puzzle or winning a game. In fact, more so, because you're probably the first person to solve it in a particular way. Plus, you can show off your results to other people, and they frequently care, even if you're not a professional or anything.
The trick is that digital copying and long-range communication mean that the value created out of staving off boredom actually is significant in market terms. It's as if your grandmother, to keep her hands busy, knit sweaters for the entire country, at no cost to her. Sure, some people want different sweaters and will still buy them from stores, but everyone has the option of chosing a free hand-knit sweater. Your grandmother, of course, doesn't care either way; she's not interested in selling things, and enjoyed knitting. In the real world, of course, your grandmother can knit a sweater for each of her grandkids, and that doesn't affect the economy. But these days, it is possible for hobbyists to generate enough valuable information that it has economic effects.
Re:No Need To Turn Economic Theory Upside-Down (Score:2)
He's talking about a problem in social organization. Previously economists have focused on two ways of organizing things:
- direct command and control by centralized management,
aka "the firm".
- competition between firms, controlled by the "invisible
hand" of the market.
If Gnu, Apache, Linux, etc fit into either of those two categories, it is not easy to see how.If there are other examples of sucessful products being produced in a similar cooperative manner -- as their probably are -- Benkler seems to be saying that economists have not paid sufficient attention to them.
Let me try a simple, general thesis here: Social organization is influenced by available technologies of communication and transportation. That doesn't sound like too much of a stretch does it? It's generally accepted that the viable size of a nation state was smaller in the days of the ancient greeks than it is now. So it would seem that a radical change in our communication technology -- like, oh, say, the development of the internet -- might change the kind of cooperative organizations that are viable.
istartedi wrote:
Some exercises for after class:Mod This Up. (Score:2)
Is software a cottage industry? (Score:3, Insightful)
Back in previous centuries, whole villages of craftsmen and women would do finishing work on mass-produced pieces that were then sold by a large retail company. The garment industry still operates this way in many instances.
As long as software remains a craft rather than a formal engineering discipline (it has elements of both, but each software project is pretty much unique to this day), then the economics of software will probably most resemble the crafts industry rather than industries based on mass production.
Re:Is software a cottage industry? (Score:2)
Curious that. It might be partially explained in that there is about an 85% overlap in the skill set of a good manager and a good programmer. Presumably, PHBs tend to view competent programmers as unfriendly threats.
Academic Blinders (Score:2)
Commons-based peer-production? How about an enjoyable hobby?
While the focus of academic specialization has contributed countless practical ideas to our civilization, people have a very hard time working in new concepts within any given academic paradigm. Why is so uncomfortable for an economist to work in the concept of people having a hobby into his specialty?
Academia needs to work on some intellectual APIs that allow for a more practical invocation of "foreign" concepts within any given specialty. Otherwise, we will continue to slide into the cellular isolation of Vinge's "focus".
- James
Re:Academic Blinders (Score:2)
There's no need for him to look at just one of the many diverse motivations possible; the goal is to look at the results, and check whether they're sustainable.
Hobbys or no hobbys.
-Billy
specialization (Score:2)
Corporations keep their mountain of work secret, so only their employees can build on top of it. Often they're even more restrictive, the only person allowed to build on top of any piece is the person the company assigns to own that piece. Open source in general, and Linux in specific, make the mountain of work public. Anyone can contribute anywhere they see fit. The pool of potentially inspired and motivated people is just so much bigger.
There's no reason to limit that to software. I hear progress in steel manufacturing follows a similar pattern. The steelmaking process is public. Whoever gets an idea finds an existing steel company and tacks it on.
The real trick, economicowise, is to allow motivated people to do what they want to do and monetarily reward them for doing it.
Before You Make a Hotheaded Reply... (Score:2)
"One important caveat is necessary. I am not suggesting that peer-production will supplant markets or firms. I am not suggesting that it is always the more efficient model of production for information and culture. What I am saying is that this emerging third model is (a) distinct from the other two, and (b) has certain systematic advantages over the other two in clearing human capital/creativity. When these advantages will outweigh the advantages that the other two models may have in triggering or directing human behavior with relatively reliable and reasonably wellunderstood triggers of money and hierarchy is a matter for more detailed study. I offer some lines of understanding the limitations of this model of production in Part III, but do not attempt a full answer to these questions here."
So does your blustering comment about "the realities of the marketblah blah blah rabble rabble" seem so worthwhile now?
Cause I can't do it along (Score:2)
I'm a fairly smart guy, and I have a degree in Computer Science. It is reasonable to assume that I can write and OS from scratch, throw a GUI on it, write my own web browser, and word processor. However to do the above all on my own takes too long. I'm not satisfied with with the commercially avaiable equivelents that I can afford so ecconomics suggests that I will do something else. Since it would take me years to write all the above (1 year each for minimal: os, compiler, GUI, gui toolkit, device drivers... working full time).
I can do it though. However by using open source I can get help. Linux/*BSD are good OSes, by starting with them I can take a good network stack, and replace the schedular with one that is better, and have a good OS. In the mean time someone else can fix a bug I haven't seen yet in the network stack... If I don't like my desktop, KDE/GNOME are good starting places to make things better, without spending years getting to where they are first. And they provide things I consider nice but not critical that I would never touch on my own.
Open source makes sense, so long as I have income, and there is something I need that I can't get.
Slashdot (Score:5, Interesting)
Of course, many open-source advocates are wont to believe that this proposition is false, because to believe so is a tacit admission that some (but not necessarily all) part of their motivations involves the (some might say shallow) gratifications that comes for leading something, or from having their name "known" and praised, or even, from following someone else - it's an admission that we crave peer-approval/recognition. Now, you can assign economic utilities to this sort of peer-gratification, but that means the economic theory MUST fall back on a psychological theory.
Just look at the case of Slashdot, which is discussed at some length in the paper. There's NO way to explain why people contribute lengthy posts from a purely "economic" viewpoint and without reference to very subjective terms. You can't get a job or contracts because of your insightful Slashdot posts. You can't make business contacts through Slashdot posts.
What would happen if Slashdot were anonymized, or if changes were made so that people couldn't receive gratification from moderation ?
Imagine that Slashdot started running threads, sorted and nested as they are now, but with NO moderation totals and NO comments ("Funny/redundant/Interesting/etc"). I bet that posting would become much less popular...but I can't see how you could explain that without psychological reference. It is clear that many if not most posters derive significant psychological gratification from getting the "pat-on-the-back" of an up-moderation and "Interesting" tag...But is there an economic explanation ?
Similarly with the notion of karma. I've gone on too long already, but suffice to say I can't see how you can explain how carefullly many users tender to and monitor their karma without capitulating to the notion that they derive significant gratification from peer-approval.
We may seem shallow for it, and hence we might not want to believe it, but I think it's true.
Re:Slashdot (Score:2)
But the explaination of why
O.S. exists because a lot of people have a lot of free time on their hands. But it has not taken over the world becuase no one has all day every day free time on their hands.
Re:Slashdot (Score:2)
Re:Slashdot (Score:2)
Here's my explanation: the site's quality and popularity are inversely related. I can grant you that much of what goes on here today is ego-driven without conceding that the site would just keel over and die if you took out that ego drive. In fact, Slashdot was a much better website before its creators gave users a yardstick (karma) to measure themselves by. Discussions were educational because people actually knew what they were talking about, or they were entertaining because everyone was pretty smart. By participating we were all rational actors maximizing our utility, be it through leisure or and time investment spent learning about something new with the hope of a future payoff. And that's just basic econ 101 for you, sans all the normative psychoanalytic babble.
Re:Slashdot (Score:2)
There's a bit of peer recognition/approval but it is much more an internal sense of rightness. My own opinion of myself is much more important to me than anyone else's, but a bit of approval here and there doesn't hurt.
Bandwidth shortage is about to stomp P2P (Score:4, Interesting)
Consumer P2P file-sharing will shortly be history.
Economic Schooling (Score:2)
Well duh! As any economist can tell you, money isn't everything.
Economics is the study of human action. Why do people do what they do? Because they expect that they will either gain by the action, or avoid loss by the action. Since market prices are easy to measure, and most people are very shallow individuals, money is a very common measurement in economics. But money is not the only value. Love, respect, pleasure, fun, satisfaction and a whole bunch of other non-quantifiable things are perfectly valid and accepted economic values.
Dan Gillmor is not an economist, so he could perhaps be excused for thinking that economics is about market prices, employee relationships, price points, and all that other mumbo-jumbo. Let me clue him in a bit. Hey Dan! Economics is the study of why you chose to write aobut Benkler's paper.
Re: (Score:2)
New Economy?? (Score:2)
"quantify behavior"??!?!?!??!?! (Score:2)
YOU CANNOT QUANTIFY HUMAN BEHAVIOR.
The insistence that you can is at the root of much of the politico-economic evils of the modern era.
Linux == new Oppose Sun Forever (Score:2)
A graphic illustration of the hopelessness of a Unix hardware vendor other than IBM trying to sell middleware for Java can be seen in the collapse of HP's NetAction Software Suite. There is simply no place for HP at the Java table.
But as IBM long ago realized it would be wise to give Sun something to worry about. The remnants of the former Oppose Sun Forever coalition have re-formed, this time with Linux as their project to humble Sun.
I'm a little worried about history repeating itself. Once again an industry consortium is banding together without a good sense of how to improve computing for everyone. Before Oppose Sun Forever the Unix companies employed researchers whose interests ranged over all of computing and who contributed to the community through papers, code, informal cooperation. There has been a tremendous narrowing of focus in favor of corporate IT computing. But IT spending is not exactly increasing, nor will it increase while the telecom industry is so deeply in debt.
While Oppose Sun Forever and Sun were fighting the last time, computing for non-business users was ceded to Microsoft. X was a monstrous bureacratic compromise, and there was no equivalent of X for audio or video.
What indication is there that these clowns aren't just going to create another version of the Open Group while standards go uncreated for natural language processing and artificial intelligence, once again ceding the field to what Microsoft does at Microsoft's pace?
Too Bad He's Bought into the GNU/Linux Meme (Score:2)
Re:He forgot something basic (Score:2)
Well, lessening the proportion of contributors anyway. The amount stays the same.
Cheers,
Ian
Re:He forgot something basic (Score:3, Insightful)
Hmm. Not really applicable to open source though, is it? I'd agree that this is the conventional model. However, no-one ever gave anything back in the first place to the developer, so whatever their incentive to start writing was - that incentive still exists.
Cheers,
Ian
Re:He forgot something basic (Score:5, Insightful)
The freeloader problem really manifests itself only in the Tragedy of the Commons. That is, freeloaders are only a problem when resources are scarce.
If we assume the marginal cost of distributing free software is 0 (which is probably true for the developer as there a many sites that will mirror popular software distributions), then why does it matter if 100 or 1000 or 1 million people download it?
I think most open source developers would be happier to have a popular application with 10mm freeloaders, rather than pulling a Bill Gates and bitching about all the ungrateful pirates out there.
The real viability issue for open source is whether it is possible to maintain a stable base of developers for an application -- not the number of freeriders.
Tragedy of the Commons was a lie (Score:3, Interesting)
Basically, your local potentate would do a favor for the crown, and receive a grant of lands that were previously "common". The first thing the new landowner would do was grow impassable hedges around his new lands, effectively walling of a 500-2000 acre chunk of the commons. The concept of the "tragedy of the commons" was invented as an excuse to take the land away from those commoners, who were "obviously" not going to use it effectively anyway.
As more and more land was removed from the commons (by the aristocracy, *not* despoiled by commoner overuse), problems of resources to feed the populace arose. But the overpopulation problems did not start until well after much of the prize real estate was placed in private hands.
So, something to think about when you hear "The Tragedy of the Commons" cliche trotted out--the concept was invented to blame the prior holders of the common for an economic crime being committed against them. Kind of like how the internet needs to taken away from its creators and placed in private hands, because the current situation is, well, too "anarchic".
Re:He forgot something basic (Score:2)
So let's look at the Lighthouse Problem. 100 ship captain's desire a lighthouse. It costs $50,000 to build one. The value of the lighthouse to each captain is $1000. How does the lighthouse get built? Obviously, if every captain contributes $500, then the lighthouse gets built. If one captain decides not to join the Lighthouse Fund, it will still get built. If 51 captains decide not to join, it will not. It is in a captain's best interest not to join the Fund, and be a freeloader. But if every captain chose not to join, then it won't get built.(p.s. the typical solution to this dilemma is to create a government and tax all captains by force)
Now for the comparison. Once the lighthouse is built, the light from it is NOT SCARCE. Once a piece of Free Software gets written, it is not scarce. But both creating the lighthouse and writing the software are going to expend resources. In the case of the lighthouse it will be monetary resources. In the case of the software it will be time resources.
The situation with Free Software is as if one of those captains was a hobbyist lighthouse builder. He enjoys building lighthouses. So he goes and builds the lighthouse. He spends the rest of his days bitching about the other 99 freeloaders. The 99 "freeloaders" complain that the lighthouse is the wrong color. And masons' guild lobbies congress to outlaw freelance lighthouse building.
Re:Wuzzah? (Score:2, Informative)
Re:Wuzzah? (Score:3, Informative)
Economics is not the study of money. It is the study of the flow of resources and value through a system. Early economic systems had nothing being sold - things were given or traded, and in some gift-based cultures you got nothing tangible in return. OpenSource has a definite economic structure and flow of resources - they follow the interest.
Actually, I would make the argument that OpenSource-type movements are only really possible in an already mature and vibrant economy. Could OpenSource have evolved without this strange commodity we call "free time?" Most of human history was involved with very few activities: eating, sleeping, reproducing, fighting, and running away from things try to kill you. Only in the last few centuries have societies evolved with "free time" built into them. Once you have free time, you have time to think about what you "enjoy." Once you know what you enjoy and some extra wealth lying around (either in the form of time, currency, or resources), then you can pursue the things you enjoy. Only in this final state can OpenSource (as it exists today) really work and thrive.
Funny, if my hypothesis is correct, OpenSource is not some anti-American (or anti-Liberal Capitalist Democratic Republic, for those of you outside of the USA) conspiracy, but rather a natural outgrowth of our society.
The Punk Eek of Human Life (Score:2)
Anthropologists will tell you that the traditional or customary pattern of human life is long-ish periods of inactivity or mild activity, punctuated by short periods of backbreaking labour (the "punctuated equilibrium" I tossed off in the title). Even today, farming works this way, as many things only need to be done three or four weeks a year, and only can be done between sunup and sundown.
"Free time" (not a commodity, by the way) is what produced those astonishing paleolithic art objects (such as the Willendorf "Venus" or the Lascaux cave paintings), the first textiles (and most textile products [weaving, spinning, embroidering, sewing] until well into the 20th century), music, and religion. Depending on where you live, those winter nights (and days) are long, and there's not much to do, really, or those summer days are long, and it's too hot to do much. These types of patterns continue even today in many, if not most, cultures around the world.
What has this to do with Open Source? Well, Open Source in and of itself is not precisely a new idea, just sort of a new variation on and old idea. In earlier times, anyone would be free to look at anything produced by a local artist, artisan, or crafter, and imitate it/improve upon it as best he or she could. (In fact, some cultures, such as among the habitant girls in New France, improvements [in this case, in embroidery skills and patterns] are/were ritualized into a game, often with very specific social meaning.)
So if you want to build yourself a bog dress [utulsa.edu] from someone else's pattern, you can (and you could if you lived in Moy centuries ago, too), just as you can take someone else's source code and build yourself a customized program that fits your needs like a tailored garment fits your body.
All of these endeavours take (free) time, though.
Re:Sourceforge business plan (Score:2)
Yeah, but I dare you to come up with a SourceForge theme song that parodies the Underpants Gnomes! Maybe something like this:
Time to go to work
Work all night
Search for open source fame
We won't stop until we kill Micro$oft
Yum-tum-tummy-tah-tey
That was hillarious, though.
Re:Coase's pengiun (Score:2)
For some reason, I read that as "Goatse's Penguin"
Guess I've been reading at -1 too much lately...
Actually, If you were Steve Ballmer, your view of this paper would have you imagining that you are the goatse guy.
Soko
Re:one word (Score:2)