Note: I think I've may have asked this before, but I'm not sure.
I've been thinking about writing some stuff about the economics of software development, but not from the usual angle. Instead, I want to write about issues that would make most software developers and managers say "huh?" while making most economists say "duh!"
In the "Mythical Man Month," for example, Brooks pointed out how scalability of teams is limited by communication issues. This was a major revolution to many managers, but any first year economics student would have said "dude, you're talking about diminishing marginal returns." For some reason, software developers borrow from accounting, biology, and a host of other fields but they scratch their head over basic economic issues which have a huge impact on software development and distribution.
Security has positive externalities and thus is likely to be underfunded. Microsoft software often has negative externalities and is possibly overproduced. Had Digital Research understood a simple concept with a horrendous name called "the cross price elasticity of demand", they may not have priced CP/M-86 at six times the price of that pesky little PC DOS competitor, even if it was an "inferior product." Not grasping the implications put them out of business. (To be fair, some claim that IBM set the price of Digital Research's product, but I'm not certain that's the case.)
Can anyone recommend good resources to search for more information like this? I'm more interested in macro than micro issues (as the latter is better understood by business), but anything is worth reading. I'm reading "In Search of Stupidity" right now and it's interesting information but it really doesn't cover the economic aspects directly. Instead, it treats them entirely as marketing issues.