With the advent of successful self-loading pistols, one of the additional markets that many companies tried to appeal to was the compact carbine. Self-loading rifles in proper rifle cartridges would not be developed as quickly as the pistols because their much greater chamber pressures represented a more difficult engineering problem. However by simply attaching a stock and long barrel to a pistol, many ambitious manufacturers hoped to sell a weapon as a sporting carbine. These were done by DWM with the Luger, as well as Mauser's C96, Mannlicher 1894 pistol, and many others.
Model 1902 was the designation of the major batch of commercially made Luger carbines, although there were several small batches of prototypes prior. Only a couple thousand were made, and they ultimately took quite a long time to all sell - it turned out this type of firearm was simply not very popular for its cost. The same story was true with the other contemporary pistol-carbines - none would be very successful. DWM did make another group of carbines in the 1920s, although those were made from various leftover parts and are both not as nice as the original 1902 guns (which were mostly made in 1904 and 1905) and widely faked.