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authorMatěj Cepl <mcepl@cepl.eu>2018-10-08 00:27:44 +0200
committerMatěj Cepl <mcepl@cepl.eu>2018-10-08 00:27:44 +0200
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+The Nature of the Red Hat
+#########################
+
+:date: 2018-09-20T11:55:11
+:status: draft
+:category: computer
+:tags: research, economics, FLOSS
+
+
+Abstract
+========
+
+Article applies theory of XC`@coase:1937nature` to the
+reality of the open source development communities and explains
+role of Red Hat in these communities. Finds a similarity between
+free market exchange and independent open source developers on
+one side and firms on the other side.
+
+Author argues, that despite obvious advantages of the open source
+development model, the traditional centrally managed model of
+development cannot be ignored completely, and it could be useful
+to crystallize free-flowing open-source community development.
+
+The Nature of the Firm
+======================
+
+
+Michael Tiemann described in
+:xcite:`@michael_tiemann:2018awesome` how the open source
+development model is superior to proprietary solutions because of
+the lower transaction costs citing mostly
+XC`@oliver_e._williamson:prize` and referring to
+:xcite:`@coase_prize_nodate`
+
+However, there is another part of the Coase’s thinking which
+I believe is very relevant to the nature of larger companies in
+the middle of the open source universe, which was not coverred in
+the article.
+
+VC`@coase:1990notes` describes the economical thinking of
+that time in the issues related to the theory of firm as
+basically following the classical theory of
+XC`@smith:1993inquiry`, which was thinking mostly only about
+the free market exchange of multiple independent producers and
+considered that to be the efficient tool for organization of
+economy. Professor Coase's thinking is (in contrast to majority
+of economists even today) very strongly empirical so the first
+impulse for writing the article was his observation that actually
+the world doesn't work as predicted by the classical theory and
+instead of majority of the economical exchange being done between
+multiple small independent actors, major part of economy is
+dominated by huge firms. After all, this is 1930s we are talking
+about, the time of huge completely vertically integrated
+companies owning everything from raw materials needed for
+production to the company kindergarten for employees.
+
+The critical insight of the article was discovery of *transaction
+costs*. Coase's observation (quite commonsensical when you read
+about it, but he was really the first one to focus on it) was
+that transaction on free market do not cost only what's need for
+procuring materials, manufacturing etc., but that there is a
+quite non-negligible cost associated with finding a transaction
+partners, negotiating transaction, policing performance of the
+transaction, and also possible costs related to the enforcement
+of the contract.
+
+Contrasting to the transaction costs-bearing free market
+contracts, organization of transactions in firms carries just
+relatively negligible transaction costs. Superior just orders his
+employee to do something and that's it. No transaction needs to
+be organized. And although the transaction costs is certianly
+never zero, it is quite smaller than what's required by the
+contractual arrangements.
+
+That is not to say, that firms are always the ideal solution
+(otherwise, our economy would cosists only from employees and
+their relatively few employers).
+XC`@parkinson:1968parkinsons` shown as persuasively that the
+cost of running firm is far from zero and quite often quite
+non-negligible (the same thing has been described obviously by
+many many others, we can start with XC`@weber:1966max` and
+his concept of “routinization of charisma”).
+
+Therefore, Coase continues, there is no silver-bullet for
+business organization (which is what we see in reality), but
+decision on which part of economy is organized based on open
+market principles and which is run by firms is made based on many
+factors described in the article.
+
+.. Analyze exactly what the original article says, don't rely on Wikipedia!!!
+
+
+Free software community development
+===================================
+
+I understand that this article will be read by people who know
+about free software style community development more than I do,
+but let me state here just an outline of what I think are the
+most important components of such development style, so that we
+know where I am coming from (and as a security for those few
+non-technical readers I hope in my endless optimism to reach).
+
+In this article I want to talk about the free software community
+development as a style of software devleopment, without
+questioning other possible understandings of it. Looking from
+this point of view, this style of the software development grown
+up as a reaction against the proprietary centralized
+top-down-controlled style of the software development
+stereotypically attached to the development in large commercial
+software companies like Microsoft, IBM, or Oracle. Again, I don't
+argue about other differences between free software and
+proprietary software (especially concerning copyright law
+issues), but they are not relevant for the point of this article.
+
+The classical description of what I understand free software
+community development is in XC`@raymond:1999cathedral`, but
+I would argue that more important difference than between closed
+and open style of development is the one between design-driven
+and “anarchic? patch drive? bottom-up”.
+
+.. *******************************************
+
+no problems to organize a lot of resources, problem to do non-fun
+work (cleanup of the code -- although LibreOffice seems to make
+it work, why???; QA, testing, documentation).
+
+it's difficult to do large design (even in the rare cases when it
+is needed)
+
+it is almost impossible to rationalize code (e.g.,
+CryptoConsolidation; rewrites of small libraries to remove
+dependencies on unmaintained code)
+
+
+Organizational role of companies in the open source universe
+============================================================
+
+XC`@whitehurst:2011how`
+
+Most of the advocates of the free software point out obvious
+advantages of the development model in the manner very similar to
+what are obvious advantages (at least to somebody who experienced
+other arrangements of market) of the self-controlling free
+market. EXAMPLES
+
+.. bibliography::