Heterogeneity and the Dynamics of Technology Adoption
Duke University - Department of Economics
Massachusetts Institute of Technology (MIT) - Management Science (MS)
June 19, 2011
NET Institute Working Paper No. 06-26
This paper analyzes the role of individual heterogeneity in the diffusion of a network technology. Using a detailed data set on the adoption of a new videoconferencing technology within a firm, we estimate a structural model of technology adoption and use. We find that employees have significant heterogeneity in both adoption costs and network benefits, and have preferences for diverse networks. Using our estimates, we evaluate two counterfactual adoption policies, and find that a policy of strategically targeting a subtype for initial adoption can lead to a faster-growing and larger network than a policy of uncoordinated or diffuse adoption.
Number of Pages in PDF File: 68
Keywords: Dynamics, Heterogeneity, Diffusion, Network Goods, Communication Technologies, Network Effects
Date posted: November 2, 2006 ; Last revised: August 30, 2014
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