30 December 2008

Collaboration Markets and Open Source

Here's a detailed and important piece that looks at the economics of scientific collaboration. One concept that may be of particular interest to readers of this blog is that of collaboration markets:

There are good reasons it’s difficult to set up efficient collaboration markets in expert attention. Creative problems are often highly specialized one-off problems, quite unlike the commodites traded in most markets. Until very recently, markets in such specialized goods were relatively uncommon and rather limited even in the realm of physical goods. This has recently changed, with online markets such as eBay showing that it is possible to set up markets which are highly specialized, provided suitable search and reputational tools are in place.

To the extent such collaboration markets do exist in science, they still operate very inefficiently compared with markets for trade in goods. There are considerable trust barriers that inhibit trading relationship being set up. There is no medium of exchange (c.f. the posts by Shirley Wu and Cameron Neylon’s on this topic). The end result is that mechanisms for identifying and aggregating comparative advantage are downright primitive compared with markets for physical goods.

Perhaps the best existing examples of collaboration markets occur in the open source programming community. No single model is used throughout that community, but for many open source projects the basic model is to set up one or more online fora (email discussion lists, wikis, bug-tracking software, etcetera) which is used to co-ordinate activity. The fora are used to advertise problems people are having, such as bugs they’d like fixed, or features they’d like added. People then volunteer to solve those problems, with self-selection ensuring that work is most often done by people with a considerable comparative advantage. The forum thus acts as a simple mechanism for aggregating information about comparative advantage. While this mechanism is primitive compared with modern markets, the success of open source is impressive, and the mechanisms for aggregating information about comparative advantage in expert attention will no doubt improve.

2 comments:

EDunigan said...

One of the senior developers for our online database recently wrote a post about the benefits companies (save on time and money) and their customers (faster feature release) receive by participating in open source communities. Read more on Online Database Blog.
With Collaboration it is important to not only receive but to contribute.

glyn moody said...

thanks.