Contingency valuation and interviews in open-source software market: utilizing conjoint methodology in economics

Abstract

This research investigated a possible anomaly in the computer software market where seemingly irrational purchase preferences of closedsource software with an above zero price were compared to open-source software with a zero purchase cost product. Classical theory would predict consumers, when comparing two identical goods, would prefer a lower price to a higher market price. The marketplace for computer software is changing as quickly as the personal computing market. One way to determine the value of a zero purchasing cost good is to utilize the Contingent Valuation Method (CVM). This research set out to determine whether introducing interview research could lessen the bias of small sample sizes in CVM. The methodology prepared in this paper encompasses risk aversion, consumer knowledge, and demand schedules for zero-priced goods. This research evaluates if the source code’s transparency affected market demand for statistical regression software used by academic economists in Wisconsin to determine the effectiveness of the methodology developed within this research.