This paper analyzes market capacity expansion in the presence of intertemporal consumption externalities such as consumer learning, networks, and bandwagon effects. An externality leads to an endogenous shift of market demand that responds to past market capacity. Whereas market capacity grows...

This paper analyses market capacity expansion in the presence of inter-temporal consumption externalities such as consumer learning, networks and bandwagon effects. An externality leads to an endogenous shift of market demand that responds to past market capacity. Whereas market capacity grows...