|
|
 |
|
Viewing report
|
|
|
|
Adoption of System Goods. Edition No. 1
VDM Publishing House, Oct 2008, Pages: 88
The purpose of our work is to give an overview of the
theoretical and empirical literature on direct and
indirect network effects and to use the insights
gained from this review to develop a
model suitable for numerical simulation. This model
would allow us to measure the impact of a number of
environmental parameters on the adoption process, as
well as to the possibility of negative impacts of
standardisation, namely the possibility that a
technological standard emerges, which later on in the
process proves to be inferior, and that the
development of the market might depend on stochastic
results early on in the development
of a market.
Based on this review of literature, we develop our
own model. Here, consumers belong either to the group
of innovators, who do not care for network effects,
or to the group of imitators, who take
network effects into account. It will be supposed
that the incumbent technology was the
monopolist, which faces new competition from a
competing technology, which has a lower value in
direct utility, but a higher growth rate of
technology so that it will eventually overtake the
incumbent and become the new superior technology.
|
|
|
|
