Technological Standards with Local Externalities and Decentralized Behavior

Posted: 31 Dec 1998

See all articles by Robin Cowan

Robin Cowan

Maastricht Economic Research Institute on Innovation and Technology (MERIT)

John H. Miller

Carnegie Mellon University - Department of Social and Decision Sciences

Abstract

We model a situation in which agents must choose between two technologies that operate under local, positive network externalities. We find that decentralized behavior can lead to the emergence of a technical standard but can also result in a variety of other equilibria. Policy to eliminate non-standardized equilibria can be effected, but in some cases it may be very costly.

JEL Classification: C7, D2, D8

Suggested Citation

Cowan, Robin and Miller, John H., Technological Standards with Local Externalities and Decentralized Behavior. Journal of Evolutionary Economics, Vol. 8, Issue 3, 1998. Available at SSRN: https://ssrn.com/abstract=123908

Robin Cowan

Maastricht Economic Research Institute on Innovation and Technology (MERIT) ( email )

P.O. Box 616
Maastricht, 6200 MD
Netherlands

John H. Miller (Contact Author)

Carnegie Mellon University - Department of Social and Decision Sciences ( email )

Pittsburgh, PA 15213-3890
United States
412-268-3229 (Phone)
412-268-6938 (Fax)

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