A market mechanism for software component reuse
Richard D. Shang, Kannan Mohan, Karl Reiner Lang, Roumen Vragov · 2012
We propose a market based design for trading component-based software products bundled with reuse licenses that allows clients to customize software solutions onsite by reusing and reintegrating components across software systems using their own software development platforms. Using economic experiments in the laboratory with IT professionals we find that introducing reuse licenses has social welfare benefits in terms of both higher seller and higher buyer surplus as well as generating higher product variety in the market. We argue that as software development is increasingly using modularized and component-based approaches software vendor strategies based on flexible licenses permitting the reuse of software offer a viable and sustainable alternative to the traditional software business model build on monolithic user licenses.