Institutional change and information production

The organization of information production is undergoing a deep transformation. Alongside corporations, which have been for long time the predominant institutions of information production, new organizational forms have emerged, e.g. free software communities, open-content on-line wikis, and collective blogs. The paper investigates the factors that favoured the emergence of these alternative systems, called peer production. Different from the previous literature, the paper considers technology as an endogenous variable in the process of organizational design. On this basis, the paper argues that the diffusion of digital technology is a necessary but not sufficient condition to explain the emergence of peer production. A similarly important role has been played by the set of ethics that motivated the early adherents to the free software movement. Such an ethics indeed operated as a 'cultural subsidy' that helped to overcome the complementarities existing among distinct institutional domains, and let a new organizational species to emerge. © Millennium Economics Ltd 2013