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The paper presents a model of a software monopolist who benefits from a lagged network externality arising from consumers' feedback through the so-called bug-fixing effect. That is, the software producer is able to correct errors in the software code detected by previous users, improving her...
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Recent research in the field of network economics has shown how explicitly modelling the network structure of social and economic relations can provide significant theoretical insights, as well as account for previously unexplained empirical evidence. Despite their critical importance to many...
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on firms' price setting behavior in a 2x2 factorial design experiment with and without communication and under present …
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In this paper, we study the formation of endogenous social storage cloud in a dynamic setting, where rational agents build their data backup connections strategically. We propose a degree-distance-based utility model, which is a combination of benefit and cost functions. The benefit function of...
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in quantities. We show that if indirect externalities are of a moderate magnitude, the threshold degree of spillovers … above which cooperation spurs R&D investments and enhances social welfare increases with the degree of externalities. If … indirect externalities are of a strong magnitude, cooperation can also be beneficial in terms of welfare for low degrees of …
Persistent link: https://www.econbiz.de/10013053397
Strategic interactions between two-sided platforms depend not only on whether their decision variables are strategic complements or substitutes as for one-sided firms, but also - and crucially so - on whether or not the platforms subsidize one side of the market in equilibrium. For example, with...
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