Heterogeneity and the Dynamics of Technology Adoption

68 Pages Posted: 2 Nov 2006 Last revised: 30 Aug 2014

Stephen Ryan

Independent

Catherine E. Tucker

Massachusetts Institute of Technology (MIT) - Management Science (MS)

Date Written: June 19, 2011

Abstract

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.

Keywords: Dynamics, Heterogeneity, Diffusion, Network Goods, Communication Technologies, Network Effects

Suggested Citation

Ryan, Stephen and Tucker, Catherine E., Heterogeneity and the Dynamics of Technology Adoption (June 19, 2011). NET Institute Working Paper No. 06-26. Available at SSRN: https://ssrn.com/abstract=941224 or http://dx.doi.org/10.2139/ssrn.941224

Stephen Ryan (Contact Author)

Independent

No Address Available

Catherine E. Tucker

Massachusetts Institute of Technology (MIT) - Management Science (MS) ( email )

100 Main St
E62-536
Cambridge, MA 02142
United States

HOME PAGE: http://cetucker.scripts.mit.edu

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