A growing body of literature has succeeded in explaining the economics of existing open source communities. However, the question why such communities come into existence has so far not been answered satisfactorily. This paper addresses this question with an evolutionary model: software developers repeatedly decide whether to use an open source or a proprietary license using boundedly rational decision rules. We analyze the resulting stochastic process and provide conditions under which open source licensing is the only long-run outcome that is stable to perturbations. It turns out that these conditions coincide with important stylized facts about thriving open source communities.
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