[OPE-L:7603] Re: Re: Value of information

From: gerald_a_levy (gerald_a_levy@msn.com)
Date: Thu Sep 05 2002 - 08:12:20 EDT

Re Paul C's [760l]:

> Something analogous to rent is clearly involved. But it generally
> does not take the form of rent directly - i.e., a payment per annum
> for use of the software. Instead there is a one off cost of purchase
> which exceeds the cost of producing that copy of the software.
>  What differentiates this from classic rent though, is that unlike land,
> software is a product of labour. It is possible, and indeed is
> to cost a software development project in terms of person years.
> One must therefore differentiate between the value of the information -
> in terms of the effort required to write the software, and the
> price that each individual copy commands.

I think that the rent received by software companies is more like other
forms of technological rent than land rent.   The rent received by
those companies is not so dissimilar  to that received by oligopolies for
their differentiated products.   What seems somewhat different from most
oligopolies is the rate of change in new products and thereby the rate of
technological  obsolescence of the older commodity (software) product.
Here again we see the topic of moral depreciation -- but in this case for
means of consumption (to the extent that software can also be a consumer
good) as well as means of production (since software can be both means
of consumption and means of production.) To some extent, this rate of change
involving the forced obsolescence of older software is planned by the
software companies themselves (especially Microsoft as the leading
oligopoly), to  another extent it is uncertain and can't be accurately
It is interesting to note the relationship between hardware and software
in this regard since changes in one often lead to changes in the other and
thereby the forced obsolescence of older related complementary

Another unconventional issue is the 'competition' of free software with
software produced as commodities.  E.g.  GNU vs. UNIX. See:
It is also important to note that changes in software can lead to
changes in skill requirements for workers operating the software and,
thereby, deskilling.  Indeed, one might say that the 'user friendly'
trend of the last 20 years (especially since the popularity of GUIs
such as Macintosh and Windows)  has led to deskilling for many
skilled workers but raising of skill requirements for other workers.

In solidarity, Jerry

PS: HAPPY BIRTHDAY, OPE-L.   Today marks our seventh

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