Harvard 2019 study on government technology policy effects
Government Technology Policy, Social Value, and National Competitiveness[1] is a 2019 working paper by Frank Nagle, Assistant Professor of Business Administration at Harvard Business School, studying the use of free software in public administration. The author focuses on the economical impact of Circulaire 5608, a series of guidelines signed into law by the Prime Minister of France in September 2012 that intended to promote the use of free software within all of France’s public administration departments.[1]:5
The paper seeks to answer whether country-level technology procurement regulations that favor free software have any impact on the level of contribution to free software from that country, as well as if there are any measurable spillover effects that enhance the national competitiveness of that country.[1]:2
Summary
From the study's abstract:[1]:1
The results show that within France, the regulation led to a 0.6% - 5.4% yearly increase in companies that use OSS, a 9% - 18% yearly increase in the number of IT-related startups, a 6.6% - 14% yearly increase in the number of individuals employed in IT related jobs, and a 5% - 16% yearly decrease in software related patents. All of these outcomes help to increase productivity and competitiveness at the national level. In aggregate, these results show that changes in government technology policy that favor open-source software (OSS) can have a positive impact on both global social value and domestic national competitiveness.
Effect on software patents
A section is dedicated to software patents, where it is noted that the law led to a decrease of French software patent applications at the USPTO.[1]:24–6
Given the apparent increase in the amount of IT labor and IT related startups induced by the Circulaire 5608, it is reasonable to think there might be an increase in the number of software related patents applied for by French residents. However, it is critical to point out that the induced increase in software expertise came with an increased awareness of open source principles. Therefore, it is quite possible that the number of software patents applied for would decrease, relative to other countries, since programmers in France are now more aware of open source methods for creating software. To measure this outcome, we rely on software patents applied for in the United States (rather than Europe). We do so because the rules related to what can be patented make it much easier to obtain a software patent in the United States than in the EU. [...]
Therefore, the estimates indicate the Circulaire 5608 led to a 5% to 16% decrease in the number of software patents applied for per year. [...]
[I]t is quite possible that this reduction in software patenting activity will lead to a positive impact on France’s future growth in the industry.
Conclusion
The survey concludes by identifying an increase in competition within France with a simultaneous reduction in the number of software patents.[1]:27
[The study] shows that the passage of the regulation led to an increase of 599,000 OSS contributions per year from individuals in France, which created a social value of nearly $20 million per year. A placebo test using a similar law passed in Italy that was never enforced shows this effect was indeed the result of the law rather than any underlying trends that led to the passage of the law. The study also shows this increase in contributions led to benefits for France that increased its national productivity and competitiveness by increasing the number of firms using OSS, the number of IT startups, and the amount of IT labor, and decreasing the number of software related patents. Given that the primary reason France implemented Circulaire 5608 was for cost savings, this study identifies a cost-effective policy lever countries can use to both create global social value and increase their own national competitiveness.
External links
References
- ↑ 1.0 1.1 1.2 1.3 1.4 1.5 Nagle Frank, Government Technology Policy, Social Value, and National Competitiveness[PDF], Harvard Business School Strategy Unit Working Paper, No. 19-103, 2019-03-03, doi:10.2139/ssrn.3355486.
