Sunday, February 27, 2005
Distributed Economies of Scale
Was reading this, which is a response to the Britannica ed's attack on Wikipedia, which references the fairly seminal 2002 piece by Benkler, which argues that open-source/open-access/massively-distributed production is a fundamentally new production paradigm (the standard other two being firms and markets).
Benkler outlines two mechanisms that make open-source production superior in many situations: lower opportunity costs (what I've termed distributed economies of scale), and efficiency gains in resource allocation via self-selection leading to increasing returns. I'm not so sure about the second one - if there were really these kinds of increasing returns, surely we would see faster growth of open-source production across industries. I also think it's important to note that the means of production must either be distributable (ie, you cant massively distribute a cement factory).
But I'm nitpicking - the paper is highly recommended (I linked to it before, so sorry if you see something old). It's a bit dense, but well worth the effort.
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