Inefficient Standard Adoption: Inertia and Momentum Revisited

29 Pages Posted: 26 Apr 2003

Multiple version iconThere are 2 versions of this paper

Date Written: October 7, 2004

Abstract

This paper examines the possibility that consumers will adopt an inefficient standard. When there are successive generations of consumers, the current generation will not consider the costs and benefits to past and future generations of adopting a new standard. If a standard is proprietary, the incentives of a firm to induce adoption of the standard generally do not match the social incentives. The divergence is caused by the firm's imperfect ability to appropriate the future surplus generated by the standard.

JEL Classification: L0, L1

Suggested Citation

Clements, Matthew T., Inefficient Standard Adoption: Inertia and Momentum Revisited (October 7, 2004). Available at SSRN: https://ssrn.com/abstract=396220 or http://dx.doi.org/10.2139/ssrn.396220

Matthew T. Clements (Contact Author)

St. Edward's University ( email )

3001 South Congress Avenue
Austin, TX 78704
United States
(512) 428-1321 (Phone)

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