We have patterns of behavior that economic theory does not predict. We are risk averse. For example, it makes no sense to buy a warranty; we buy them out of an absurd sense that buying the warranty affects the device’s outcome. There is another kind of bias that we wouldn’t predict from economic theory: A systematic bias against openness. We don’t expect openness and collaboration to generate what they do. We overestimate the risks. We underestimate the risks of closed systems and overestimate closed systems’ benefits.
Suppose in 1990 I came to you with two proposals: Build an open system. Or, build something like Minitel, Compuserv or AOL; it’s controlled and permission-based. Which would you pick? If you pick the first, you’ll have piracy, spam, massive amounts of crap, flame wars, massive violations of IP, use for immoral purposes. “I think you’d pick network #2″ because those risks are foreseeable, but you couldn’t imagine wikis, blogs, Google maps, etc. It’s hard for us to imagine the benefits of open systems. It’s not intuitive.
Again, in 1990 you are asked to assemble the greatest encyclopedia, in most
languages, updated in real time, adopt a neutral point of view. In 1990, you’d say that you need maybe a billion dollars, a hierarchical corporation, lots of editors, vet the writers you’re hiring, peer reviewers, copyright it all to recoup the money we’ve invested, trademark it. And someone else says, “We’ll have a web site, and people will like put stuff up and people will edit it.” How many of us would have picked #2. We don’t understand openness.
Free software is the same story.