Software Engineering Economics

Software engineering economics applies economic analysis to decisions about software: what to build, how to build it, whether to buy or retire it, and at what price. It treats every technical decision as having an economic dimension that can be modeled, compared, and communicated to stakeholders. Ignoring economics does not make a decision neutral — it makes it implicit.

Three ideas drive everything below:

1. Every technical decision is an economic decision. Choosing an architecture, a technology stack, or a development approach allocates costs and creates option value. Engineers who cannot articulate the economic consequences of their technical choices are making half-decisions. A microservices migration is not just a scalability choice — it is a choice about where operational costs will concentrate, what skills the team must maintain, and what future deployment options become available or foreclosed.