January  2008, 4(1): 199-211. doi: 10.3934/jimo.2008.4.199

Competition with open source as a public good

1. 

School of Management, The University of Texas at Dallas, Richardson, TX 75080, United States, United States, United States

2. 

Chongqing University, Chongqing 400044, China

Received  May 2007 Revised  September 2007 Published  January 2008

The open source paradigm is often defined as a ''collaborative effort,'' implying that firms and consumers come together in a non-competitive climate. We show here that open source development can arise from a competitive climate. Under competition, we find that open source is the surplus maximizing outcome and can be in equilibrium if cost asymmetries are small. However, when cost asymmetries are large, contradictions between equilibrium and welfare maximization result. Considerations typical to public good problems arise, with issues of asymmetric contributions and free-riding. These issues should guide the firm's as well as the society's decisions to implement open source in particular environments. We analyze this problem in the framework of a dynamic duopolistic competition, with firms controlling their investments in software.
Citation: Ernan Haruvy, Ashutosh Prasad, Suresh Sethi, Rong Zhang. Competition with open source as a public good. Journal of Industrial and Management Optimization, 2008, 4 (1) : 199-211. doi: 10.3934/jimo.2008.4.199
[1]

Christoph Hauert, Nina Haiden, Karl Sigmund. The dynamics of public goods. Discrete and Continuous Dynamical Systems - B, 2004, 4 (3) : 575-587. doi: 10.3934/dcdsb.2004.4.575

[2]

Alain Bensoussan, Shaokuan Chen, Suresh P. Sethi. Linear quadratic differential games with mixed leadership: The open-loop solution. Numerical Algebra, Control and Optimization, 2013, 3 (1) : 95-108. doi: 10.3934/naco.2013.3.95

[3]

Marta Faias, Emma Moreno-García, Myrna Wooders. A strategic market game approach for the private provision of public goods. Journal of Dynamics and Games, 2014, 1 (2) : 283-298. doi: 10.3934/jdg.2014.1.283

[4]

Mathias Staudigl, Jan-Henrik Steg. On repeated games with imperfect public monitoring: From discrete to continuous time. Journal of Dynamics and Games, 2017, 4 (1) : 1-23. doi: 10.3934/jdg.2017001

[5]

Dean A. Carlson. Finding open-loop Nash equilibrium for variational games. Conference Publications, 2005, 2005 (Special) : 153-163. doi: 10.3934/proc.2005.2005.153

[6]

John A. Morgan. Interception in differential pursuit/evasion games. Journal of Dynamics and Games, 2016, 3 (4) : 335-354. doi: 10.3934/jdg.2016018

[7]

Xu Rao, Guohong Zhang, Xiaoli Wang. A reaction-diffusion-advection SIS epidemic model with linear external source and open advective environments. Discrete and Continuous Dynamical Systems - B, 2022  doi: 10.3934/dcdsb.2022014

[8]

Jingzhen Liu, Ka-Fai Cedric Yiu. Optimal stochastic differential games with VaR constraints. Discrete and Continuous Dynamical Systems - B, 2013, 18 (7) : 1889-1907. doi: 10.3934/dcdsb.2013.18.1889

[9]

Alain Bensoussan, Jens Frehse, Christine Grün. Stochastic differential games with a varying number of players. Communications on Pure and Applied Analysis, 2014, 13 (5) : 1719-1736. doi: 10.3934/cpaa.2014.13.1719

[10]

Ellina Grigorieva, Evgenii Khailov. Hierarchical differential games between manufacturer and retailer. Conference Publications, 2009, 2009 (Special) : 300-314. doi: 10.3934/proc.2009.2009.300

[11]

Leon Petrosyan, David Yeung. Shapley value for differential network games: Theory and application. Journal of Dynamics and Games, 2021, 8 (2) : 151-166. doi: 10.3934/jdg.2020021

[12]

Jiequn Han, Ruimeng Hu, Jihao Long. Convergence of deep fictitious play for stochastic differential games. Frontiers of Mathematical Finance, 2022, 1 (2) : 287-319. doi: 10.3934/fmf.2021011

[13]

Rui Wang, Rundong Zhao, Emily Ribando-Gros, Jiahui Chen, Yiying Tong, Guo-Wei Wei. HERMES: Persistent spectral graph software. Foundations of Data Science, 2021, 3 (1) : 67-97. doi: 10.3934/fods.2021006

[14]

Kuang Huang, Xuan Di, Qiang Du, Xi Chen. A game-theoretic framework for autonomous vehicles velocity control: Bridging microscopic differential games and macroscopic mean field games. Discrete and Continuous Dynamical Systems - B, 2020, 25 (12) : 4869-4903. doi: 10.3934/dcdsb.2020131

[15]

Yonghui Xia, Hai Huang, Kit Ian Kou. An algorithm for solving linear nonhomogeneous quaternion-valued differential equations and some open problems. Discrete and Continuous Dynamical Systems - S, 2022, 15 (7) : 1685-1697. doi: 10.3934/dcdss.2021162

[16]

Yu Li, Kok Lay Teo, Shuhua Zhang. A new feedback form of open-loop Stackelberg strategy in a general linear-quadratic differential game. Journal of Industrial and Management Optimization, 2022  doi: 10.3934/jimo.2022105

[17]

Ekaterina Gromova, Ekaterina Marova, Dmitry Gromov. A substitute for the classical Neumann–Morgenstern characteristic function in cooperative differential games. Journal of Dynamics and Games, 2020, 7 (2) : 105-122. doi: 10.3934/jdg.2020007

[18]

Alexei Korolev, Gennady Ougolnitsky. Optimal resource allocation in the difference and differential Stackelberg games on marketing networks. Journal of Dynamics and Games, 2020, 7 (2) : 141-162. doi: 10.3934/jdg.2020009

[19]

Zeyang Wang, Ovanes Petrosian. On class of non-transferable utility cooperative differential games with continuous updating. Journal of Dynamics and Games, 2020, 7 (4) : 291-302. doi: 10.3934/jdg.2020020

[20]

Piernicola Bettiol. State constrained $L^\infty$ optimal control problems interpreted as differential games. Discrete and Continuous Dynamical Systems, 2015, 35 (9) : 3989-4017. doi: 10.3934/dcds.2015.35.3989

2021 Impact Factor: 1.411

Metrics

  • PDF downloads (126)
  • HTML views (0)
  • Cited by (4)

[Back to Top]