In this paper we argue that restructuring firms in a transition economy produces an effect similar to a network externality, in that the profitability of restructuring depends on the number of firms that have already decided to adopt this strategy. While other papers assume the existence of a...

Restructuring firms in a transition economy produces a sort of network externality, in that the profitability of restructuring depends on the number of firms that already adopted this strategy. We investigate under what conditions a "critical mass" exists, i.e., a situation in which such...