Even though people are not paid for open source, why is it better?
I wouldn't agree that open source is always better -- however, those who participate in the development of open source software are doing so because they have the choice and a
passion to develop that specific piece of software. Open source usually is very flexible in the requirements and everyone has a voice -- if it wasn’t flexible and you didn't have a choice, no one would do it. Everyone is equal in their ideas, and this creativity is what allows the software to flourish. You work on the software when you want to, not because you have to.
When you develop software for a cooperate office, you are developing it because your manager/business assigned you the task. You are being paid to develop the software and expected to hit your arbitrary deadlines. Lack to make progress or hit your marks usually ends up in a race-condition to finish your tasks before the next meeting -- which always results in taking the easier and less thorough route. No matter how you feel that day, even if you're feeling lousy, you're still going to have to develop software. Every day you are weighted on your abilities and progress. In the end you end up developing out of fear, not out of passion.
"better" is just an opinion, I could easily argue that it isn't always. Anyhow generally speaking closed source software doesn't do much for what is considered white box testing. Where more than the original programmer looks at the source code and picks it apart for any little flaw. With open source, anyone can look at it and pick it apart and there are some very picky people in the open source community.