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Critical Mass

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Author Info
Michal Grajek (ESMT European School of Management and Technology)
Tobias Kretschmer (Ludwig-Maximilians-Universität München)

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Abstract

This paper develops a structural model of demand for a network good to provide a rigorous definition of critical mass. Using simulations, we demonstrate that our model of critical mass can be operationalized easily and can generate theoretically grounded insights about critical mass phenomena identified in empirical settings. We then propose a number of extensions to illustrate the flexibility of our model.

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File URL: http://www.esmt.org/fm/294/ESMT-08-004.pdf
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Publisher Info
Paper provided by ESMT European School of Management and Technology in its series ESMT Research Working Papers with number ESMT-08-004.

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Length: 36 pages
Date of creation: 13 Jun 2008
Date of revision:
Handle: RePEc:esm:wpaper:esmt-08-004

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Related research
Keywords: critical mass; network effects; diffusion of innovations; compatibility;

Find related papers by JEL classification:
C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Other Model Applications
L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
M37 - Business Administration and Business Economics; Marketing; Accounting - - Marketing and Advertising - - - Advertising

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