[Discuss] Economic value of OSH work

Emilio Velis contacto at emiliovelis.com
Tue Sep 2 14:53:31 UTC 2014

There are different ways of valuing open source work, and probably many
aren't even in the realm of conventional economics. The best to measure the
value of OSH work would be by comparing all the costs that R&D companies
use and compare them to how much would it cost to build an open source
equivalent. Costs are easy:

Total cost of design = total time spent by collaborators x hourly wage +
paper and materials (prints, scans, other staples)
Cost of manufacturing = machine time + materials + shipping for materials +
additives + cost of machine deprecation

You also need to evaluate in terms of:
- logistics (what you would spend in terms of price+shipping compare to
making it yourself),
- average cost of maintenance (training, spare parts)
- deprecation (the expected time the machine will work. If a proprietary
machine is expected to last 50 years with maintenance, compared to open
source options that are 10 times cheaper but you have to build a new one
every 5 years...)
- cost of intellectual property: having the source code of a machine also
gives your company value since you have a base for R&D. However, this would
have to be calculated differently because it's not a monopoly.

Maybe these ideas will give you a starting ground. Let me know if you need
any help! This would be a very good subject for a research paper.

On 2 September 2014 07:13, Joshua Pearce <professor.pearce at gmail.com> wrote:

>  Hi All,
> I know that many of you has been thinking about how to determine the value
> of OSH work. Are you aware of any methods to calculate absolute value in
> real economic terms?
> For example if you spend an hour of your time making an OpenSCAD file for
> a parametric test tube rack and put it in the public domain - and then for
> the rest of time anyone can download the file, customize the rack for their
> needs and print it for the cost of materials and a tiny amount of
> electricity. How much is that gift worth?
> Clearly it is more than your opportunity cost or wage for one hour...but
> how much more is the value to humanity?
> Is it:
> (cost to purchase - cost to print) x (number of people downloading it)?
> or
> (hourly wage of person needing a test tube rack) x (number of people using
> it)?
> or
> total value of the test tube market - (cost to print)x (number of racks in
> the market) ....summed for N years?
> or
> As the cost of test tube racks has now decreased it is the total value of
> the current market + a bonus for expanding future use because of lower
> costs + some kind of educational bonus because more schools can afford them
> + some fraction of future discoveries made possible because now part of the
> expense of doing science was decreased.....
> or
> Is there a better way to do this - and get to quantification?
> Thanks!
> Joshua
> Joshua M. Pearce, Ph.D.
> Associate Professor
> The Michigan Tech Open Sustainability Technology Lab
> <http://www.appropedia.org/Category:MOST>
> Department of Materials Science & Engineering
> Department of Electrical & Computer Engineering
> Michigan Technological University
> 601 M&M Building
> 1400 Townsend Drive
> Houghton, MI 49931-1295
> 906-487-1466
> Open Source Lab <http://store.elsevier.com/coArticle.jsp?pageid=18200010>
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