1995 Volume 4 Issue 2 Pages 53-70
The present paper aims at evaluating and comparing governmental policies for encouraging information industry such as software industry. Information industry is characterized by its unique feature: it deals with information technology and/or knowledge, and it costs almost none to make a copy of it while its research and development requires a huge amount of money and man-hours.
We first show that if the society seeks to develop sound information industry seriously it has to introduce incentive mechanism or public policy for driving the R & D activity as well as for preventing piracy of information technology. After proposing and examining several conditions from different view points, each of which represents desirability of the mechanisms in an original. way to this paper, we then compare four types of incentive mechanisms in terms of them. One of our results shows that legal regulation does not always work as the best device for encouraging information technology.
