Date Added: Nov 2009
In this paper the authors assess the economic viability of innovation by producers relative to two increasingly important alternative models: innovations by single user individuals or firms, and open collaborative innovation projects. They analyze the design costs and architectures and communication costs associated with each model. They conclude that innovation by individual users and also open collaborative innovation increasingly compete with - and may displace - producer innovation in many parts of the economy. They argue that a transition from producer innovation to open single user and open collaborative innovation is desirable in terms of social welfare, and so worthy of support by policymakers.