Innovation and Adoption of Electronic Business Technologies
AbstractThis paper presents a duopoly model of e-business technology adoption. A leader and a follower benefit from a new ebusiness technology with uncertain quality depending on its innovation and adoption cost and both firms' adoption timing. When innovation and adoption require large set-up costs, the leader favors quick adoption by the follower. The follower prefers either late or no adoption. This is due to a delayed firstmover benefit which stems from an innovators' capability to impose a new technology standard. It is shown that inter-firm adoption subsidies are a viable tool to quicken adoption. --
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Bibliographic InfoPaper provided by Dresden University of Technology, Faculty of Business and Economics, Department of Economics in its series Dresden Discussion Paper Series in Economics with number 02/07.
Date of creation: 2007
Date of revision:
Electronic Business; Adoption; Innovation; Network Effects;
Find related papers by JEL classification:
- L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
- O31 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
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- Jensen, Richard, 1982. "Adoption and diffusion of an innovation of uncertain profitability," Journal of Economic Theory, Elsevier, vol. 27(1), pages 182-193, June.
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