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Economic Analysis, Public Policy and the Software Industry

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This paper focuses on three related matters. It analyses the process of competition in the softwareindustry, this being important both in itself and for the light it throws on competition within allindustries characterised by low or zero marginal costs and a high rate of technical development. Thesoftware industry, operating under private enterprise, is dependent on copyright, and the issues raisedby intellectual property protection are therefore also considered. Given the need for inter-operabilitybetween different software products, and between these and associated hardware, standardisation isimportant within the industry, and the processes by which standards may be established are evaluated.Consideration is given to the public policy issues that are raised by these three topics.

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George B. Richardson

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