Open Source Development in a Differentiated Duopoly

Stephane Verani

    Research output: Working paperDiscussion paper

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    Abstract

    Open source software is released under an open source license giv­ing individuals the right to use, modify, and redistribute freely the programs. This paper proposes a model of dierentiated duopoly in which frms invest in the development of proprietary or open source software. The main fndings are: (i) frms invest more when the prod­ucts are substitutes; (ii) for substitute products, frms’investment in software development is greatest when the software is open source; (iii) for close to perfect complements, frms’ investment in software development is greatest when the software is proprietary; and (iv) for substitute products, investment in open source software yields higher profts than investment in proprietary software.
    Original languageEnglish
    PublisherUWA Business School
    Publication statusPublished - 2006

    Publication series

    NameEconomics Discussion Papers
    No.5
    Volume6

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