You count the “value” that is lost by people who would have made money selling rival goods, but can’t now because they can’t compete with free. But you don’t count the value that is created by people who build upon the freely given goods. [...] In other words, you only look at the first-order effects. It’s the same mistake a lot of people make when they accuse open source developers of “dumping” and ruining the market for competing software. That’s true, in a very narrow sense, but it ignores all the other people who took that software and used it to create something else of value.
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It amazes me how prevalent is the view that 'free' goods are somehow bad for the economy. People don't see that value is created by solving problems, and the most thoroughly solved problem is one that no longer exists. It is our modern day 'broken window fallacy'.
http://en.wikipedia.org/wiki/Broken_window_fallacy
Jonathan, too right.
Jeremy Dunck - 21st October 2009 20:12 - #