IDEAS home Printed from https://ideas.repec.org/p/fth/aixmeq/98a30.html
   My bibliography  Save this paper

Standardization in Decentralized Economies

Author

Listed:
  • Auriol, E.
  • Benaim, M.

Abstract

This paper studies within a dynamical model how decentralized individuals happen to elect non-proprietary standard. The issue is coordination because the individual benefit of adoption depends on whether other agents elect to adopt the same standard. It shows that whenthere are increasing returns to adoption (convexity) standardization occurs. However which standard is going to be elected is not always predictable.

Suggested Citation

  • Auriol, E. & Benaim, M., 1998. "Standardization in Decentralized Economies," G.R.E.Q.A.M. 98a30, Universite Aix-Marseille III.
    • Handle: RePEc:fth:aixmeq:98a30
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Joseph Farrell & Garth Saloner, 1985. "Standardization, Compatibility, and Innovation," RAND Journal of Economics, The RAND Corporation, vol. 16(1), pages 70-83, Spring.
    2. Fudenberg, Drew & Levine, David, 1998. "Learning in games," European Economic Review, Elsevier, vol. 42(3-5), pages 631-639, May.
    3. Ellison, Glenn, 1993. "Learning, Local Interaction, and Coordination," Econometrica, Econometric Society, vol. 61(5), pages 1047-1071, September.
    4. David, Paul A, 1985. "Clio and the Economics of QWERTY," American Economic Review, American Economic Association, vol. 75(2), pages 332-337, May.
    5. Loewenstein, George & Thaler, Richard H, 1989. "Intertemporal Choice," Journal of Economic Perspectives, American Economic Association, vol. 3(4), pages 181-193, Fall.
    6. Kandori, Michihiro & Mailath, George J & Rob, Rafael, 1993. "Learning, Mutation, and Long Run Equilibria in Games," Econometrica, Econometric Society, vol. 61(1), pages 29-56, January.
    7. Drew Fudenberg & David K. Levine, 1998. "The Theory of Learning in Games," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262061945, December.
    8. S. J. Liebowitz & Stephen E. Margolis, 1994. "Network Externality: An Uncommon Tragedy," Journal of Economic Perspectives, American Economic Association, vol. 8(2), pages 133-150, Spring.
    9. Katz, Michael L & Shapiro, Carl, 1985. "Network Externalities, Competition, and Compatibility," American Economic Review, American Economic Association, vol. 75(3), pages 424-440, June.
    10. Brian Arthur, W. & Ermoliev, Yu. M. & Kaniovski, Yu. M., 1987. "Path-dependent processes and the emergence of macro-structure," European Journal of Operational Research, Elsevier, vol. 30(3), pages 294-303, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Davide Infante & Janna Smirnova, 2010. "Market Failures within Poor Institutions: The Effects of Bureaucrats’ Rent-seeking Activity," Chapters, in: Neri Salvadori (ed.), Institutional and Social Dynamics of Growth and Distribution, chapter 5, Edward Elgar Publishing.
    2. Auriol, Emmanuelle & Schilizzi, Steven, 2000. "Quality Signaling through Certification," 2000 Conference (44th), January 23-25, 2000, Sydney, Australia 123598, Australian Agricultural and Resource Economics Society.
    3. Christopher Spencer & Paul Temple, 2016. "Standards, learning, and growth in Britain, 1901–2009," Economic History Review, Economic History Society, vol. 69(2), pages 627-652, May.
    4. Ju, Xiaosheng & Jiang, Shengjun & Zhao, Qifeng, 2023. "Innovation effects of academic executives: Evidence from China," Research Policy, Elsevier, vol. 52(3).
    5. Auriol, Emmanuelle & Platteau, Jean-Philippe, 2017. "Religious co-option in autocracy: A theory inspired by history," Journal of Development Economics, Elsevier, vol. 127(C), pages 395-412.
    6. Emmanuelle Auriol & Antonio Estache & Liam Wren-Lewis, 2018. "Can Supranational Infrastructure Regulation Compensate for National Institutional Weaknesses?," Revue économique, Presses de Sciences-Po, vol. 69(6), pages 913-936.
    7. Luís Cabral, 2011. "Dynamic Price Competition with Network Effects," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 78(1), pages 83-111.
    8. Ming Hu & Joseph Milner & Jiahua Wu, 2016. "Liking and Following and the Newsvendor: Operations and Marketing Policies Under Social Influence," Management Science, INFORMS, vol. 62(3), pages 867-879, March.
    9. Klimenko, Mikhail M., 2009. "Policies and international trade agreements on technical compatibility for industries with network externalities," Journal of International Economics, Elsevier, vol. 77(2), pages 151-166, April.
    10. Markovich, Sarit, 2008. "Snowball: A dynamic oligopoly model with indirect network effects," Journal of Economic Dynamics and Control, Elsevier, vol. 32(3), pages 909-938, March.
    11. Christopher Spencer & Paul Temple, 2012. "Alternative Paths of Learning: Standardisation and Growth in Britain, 1901-2009," Discussion Paper Series 2012_10, Department of Economics, Loughborough University, revised Oct 2012.
    12. Cantillon, Estelle & Yin, Pai-Ling, 2007. "How and when do markets tip? Lessons from the Battle of the Bund," Working Paper Series 766, European Central Bank.
    13. Lina Ma & Wanying Zhao & Longzhu Dong & Yushen Du, 2023. "Platforms Competition: An Ecosystem-View Analysis Based on Evolutionary Game Theory," SAGE Open, , vol. 13(4), pages 21582440231, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Neary, Philip R., 2012. "Competing conventions," Games and Economic Behavior, Elsevier, vol. 76(1), pages 301-328.
    2. H. Peyton Young, 1996. "The Economics of Convention," Journal of Economic Perspectives, American Economic Association, vol. 10(2), pages 105-122, Spring.
    3. Ianni, Antonella & Corradi, Valentina, 2000. "Consensus, contagion and clustering in a space-time model of public opinion formation," Discussion Paper Series In Economics And Econometrics 0009, Economics Division, School of Social Sciences, University of Southampton.
    4. Michihiro, Kandori & Rob, Rafael, 1998. "Bandwagon Effects and Long Run Technology Choice," Games and Economic Behavior, Elsevier, vol. 22(1), pages 30-60, January.
    5. Heggedal, Tom-Reiel & Helland, Leif, 2014. "Platform selection in the lab," Journal of Economic Behavior & Organization, Elsevier, vol. 99(C), pages 168-177.
    6. Xiao Han & Yun Yu & Bin Jia & Zi‐You Gao & Rui Jiang & H. Michael Zhang, 2021. "Coordination Behavior in Mode Choice: Laboratory Study of Equilibrium Transformation and Selection," Production and Operations Management, Production and Operations Management Society, vol. 30(10), pages 3635-3656, October.
    7. Jiang, Ge & Weidenholzer, Simon, 2016. "Local Interactions under Switching Costs," Economics Discussion Papers 17770, University of Essex, Department of Economics.
    8. Blume, Andreas & Arnold, Tone, 2004. "Learning to communicate in cheap-talk games," Games and Economic Behavior, Elsevier, vol. 46(2), pages 240-259, February.
    9. Holmes, Thomas J., 1999. "How Industries Migrate When Agglomeration Economies Are Important," Journal of Urban Economics, Elsevier, vol. 45(2), pages 240-263, March.
    10. P.J. Lamberson & Scott E. Page, 2018. "First mover or higher quality? Optimal product strategy in markets with positive feedbacks," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 27(1), pages 40-52, March.
    11. Lim, Wooyoung & Neary, Philip R., 2016. "An experimental investigation of stochastic adjustment dynamics," Games and Economic Behavior, Elsevier, vol. 100(C), pages 208-219.
    12. Tatsuhiro Shichijo & Emiko Fukuda, 2019. "A dynamic game analysis of Internet services with network externalities," Theory and Decision, Springer, vol. 86(3), pages 361-388, May.
    13. Takahashi, Takuma & Namiki, Fujio, 2003. "Three attempts at "de-Wintelization": Japan's TRON project, the US government's suits against Wintel, and the entry of Java and Linux," Research Policy, Elsevier, vol. 32(9), pages 1589-1606, October.
    14. Oz Shy, 2011. "A Short Survey of Network Economics," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 38(2), pages 119-149, March.
    15. Dunia López-Pintado & Duncan J. Watts, 2008. "Social Influence, Binary Decisions and Collective Dynamics," Rationality and Society, , vol. 20(4), pages 399-443, November.
    16. Edward Cartwright, 2002. "Learning to play approximate Nash equilibria in games with many players," Levine's Working Paper Archive 506439000000000070, David K. Levine.
    17. Jay Pil Choi & Christodoulos Stefanadis, 2022. "Network Externalities, Dominant Value Margins, And Equilibrium Uniqueness," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 63(4), pages 1805-1827, November.
    18. Daniel Birke, 2009. "The Economics Of Networks: A Survey Of The Empirical Literature," Journal of Economic Surveys, Wiley Blackwell, vol. 23(4), pages 762-793, September.
    19. Matros, Alexander & Moser, Scott, 2015. "Coordination in a changing environment," Journal of Economic Behavior & Organization, Elsevier, vol. 112(C), pages 64-84.
    20. Simon Weidenholzer, 2010. "Coordination Games and Local Interactions: A Survey of the Game Theoretic Literature," Games, MDPI, vol. 1(4), pages 1-35, November.

    More about this item

    Keywords

    STANDARDIZATION ; ECONOMIC EQUILIBRIUM ; DECENTRALIZATION;
    All these keywords.

    JEL classification:

    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fth:aixmeq:98a30. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Thomas Krichel (email available below). General contact details of provider: https://edirc.repec.org/data/greqafr.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.