[Discuss] Economic value of OSH work

David Kelly eforma at gmail.com
Wed Sep 3 13:18:38 UTC 2014

“.....Are you aware of any methods to calculate absolute value in real 
economic terms? ”

Dear Joshua, this is something I have been puzzling over for many years, 
and it is difficult to resolve because that value is subjective.

If I have a huge need to find information, or hardware designs, or 
software, at a given moment in time, then at that particular moment, the 
value to me of my required object or information is directly 
proportional to my need. It could be astronomical, or not much.

For example if in my village with very limited means has 20 people die 
per month from drinking polluted water, if I can (easily) find a proven, 
trustworthy open hardware device that solves the problem, physically 
producing that device is within my means and there is support available 
from the open hardware community, its value is extremely high, much 
higher than the cost to the inventor of developing and placing that 
device in the open realm. Yes, in making it open the inventor loses the 
capacity to exclusively comercialise the product, but receives 
invaluable feedback from the community, and is as free as anyone else to 
make money from building and installing the product using the extra edge 
their specialist knowledge gives them, plus that highly valuable feedback.

The costs of inventing, developing and documenting a device are defined 
by the nature of the object in question, R+D, materials and labour 
costs. Up to this point things are the same for both a commercial or an 
open product.

For a commercial product, once put into production its value is 
calculable at any given moment and depends on demand and supply. Its 
value is not fixed, it will rise and fall.

By placing a device in the “open” world, it now exists beyond the realm 
of competition, but not entirely, there is an overlap, participants can 
still sell the devices they get from the community if they wish and 
compete with closed products, so it will still have a commercial value 
but that will have been altered by the fact that it is open hardware.

By placing a good in the open realm, we remove all development costs and 
barriers to production for everybody else, the value of this is huge, we 
are enabling people by giving them everything they need (less tools and 
labour) to produce a good, so there is this added value coming from the 
act of sharing and participating in a sharing community, and of course 
there is also the value of the support available from within that community.

The people who form sharing communities create value, just by 
participating and sharing, because they exploit the difference between 
the cost for the giver, and value to the receiver at a given moment. How 
big this value actually is depends entirely on the players and their 
circumstances, but it is always a positive value.

Best wishes to all

David Kelly

contact: eforma at gmail.com

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