The link between incentives and product performance in open source development: an empirical investigation

In open source software development, users rather than paid developers engage in innovation and development without the direct involvement of manufacturers. This paradigm cannot be explained by the two traditional models of innovation, the private investment model and the collective action model (von Hippel and von Krogh, 2003). In order to bridge the gap between existing models and the open source phenomenon, we analyse data from a web survey of 160 open source developers. First, we empirically demonstrate that there is a common ground between the private and collective models where private returns and social considerations can coexist. Second, we explore the effect of incentives on the output of innovation – final product performance. The results show that social considerations and monetary rewards are significant in affecting different dimensions of product performance.