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The Jukebox Mode of Innovation - a Model of Commercial Open Source Development (2004)
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BibTeX
@MISC{Henkel04thejukebox,
author = {Joachim Henkel},
title = {The Jukebox Mode of Innovation - a Model of Commercial Open Source Development},
year = {2004}
}
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Abstract
In this paper, I explore the circumstances under which innovation processes without secrecy or intellectual property protection are viable, and where free revealing of innovations is a profit-maximizing strategy. Motivated by an empirical study of embedded Linux, I develop a duopoly model of quality competition. Firms require two complementary technologies as inputs, but di#er with respect to the relative importance of these technologies. I find that a regime with compulsory revealing can lead to higher product qualities and higher profits than a proprietary regime. When the decision to reveal is endogenized, equilibria with voluntary revealing arise, again superior to the proprietary outcome.
Keyphrases
jukebox mode commercial open source development free revealing compulsory revealing complementary technology embedded linux empirical study profit-maximizing strategy duopoly model proprietary outcome intellectual property protection quality competition relative importance product quality proprietary regime voluntary revealing arise
