  The paper explains why open source software is an instance of a potentially
broader phenomenon. Specifically, I suggest that nonproprietary peer-production
of information and cultural materials will likely be a ubiquitous phenomenon in
a pervasively networked society. I describe a number of such enterprises, at
various stages of the information production value chain. These enterprises
suggest that incentives to engage in nonproprietary peer production are trivial
as long as enough contributors can be organized to contribute. This implies
that the limit on the reach of peer production efforts is the modularity,
granularity, and cost of integration of a good produced, not its total cost. I
also suggest reasons to think that peer-production can have systematic
advantages over both property-based markets and corporate managerial
hierarchies as a method of organizing information and cultural production in a
networked environment, because it is a better mechanism for clearing
information about human capital available to work on existing information
inputs to produce new outputs, and because it permits largers sets of agents to
use larger sets of resources where there are increasing returns to the scale of
both the set of agents and the set of resources available for work on projects.
As capital costs and communications costs decrease in importance as factors of
information production, the relative advantage of peer production in clearing
human capital becomes more salient.
