Also published at [http://www.firstmonday.org/issues/issue11_1/barwolff/index.htmli](First Monday 11-1).
This paper develops the notion that open source has become a viable mode of production and resource allocation not only for intrinsicly motivated communities but for commercial firms, too. Following received economic wisdom this is due primarily to the fact that open source ultimately produces greater value on both the use and the production side. Open source thus acts as an institution that impacts on the structure of the software industry much more efficiently than politics and law. It also provides an economic perspective that may help refine the standard notion of the firm since it emphasises the link between firm and market, not the frontiers that separate the two.