Open Source

The efficacy of open source software as a solution to the needs of business purchasers is an important question that has arisen as open source software has grown in importance.

Profit motives provide incentives for producers of proprietary software to have their products meet the needs of consumers. At the same time, these companies do not want to reveal the underlying code for fear that it will be stolen. Producers of such software need to be responsive to customers if they want to succeed in the market, although their software is likely to be less easily customized.

Open source software makes it code available to everyone, allowing for greater tailoring of software by those capable of writing their own code. Nonetheless, there is less incentive to produce a product that makes end-users happy.

Finally, brand name value maximization provides private owners with strong incentives to avoid producing defective products while at the same time ensuring that compensation will be available should the product fail to work as advertised. There is no residual claimant to the brand name of open source software, thus some alternative mechanism would need to be provided to achieve the same result.

It is important to understand the strengths and weaknesses of each system and the differential transmission mechanisms that starts with consumer desires and ends with the production of software to meet their needs. This topic is of interest to various members of the Center and several streams of research are likely to take place in answering these questions.