Auteurs
Benoît DEMIL
Xavier LECOQ
Abstract
Despite the growing body of literature describing the open source phenomenon, research has largely focused on the software industry. Drawing on transaction cost economics, we propose that open source projects illustrate a new generic governance structure — which we label bazaar governance — based on a specific legal contract: the open license. We characterize this structure in terms of its strengths and weaknesses and compare it to market, firm and network forms. Low levels of control and weak incentives intensity are distinctive features of bazaar, lending a high uncertainty to governed transactions. However, bazaar governance promotes the openness of open source communities, which can generate strong positive network externalities and subsequent efficiency in cumulative transactions. Our developments offer a potential basis for future research.
