Adoptions and Orphans in the Early Microcumputer Market
In this paper we develop a model with (1) differentiated consumers, (2) endogenous adoption times, (3) technical uncertainty, and (4) alternative technologies sponsored by competing vendors. We identify conditions under which orphaning arises endogenously in a framework of dynamic competition. We then use the model to examine the development of the micro-computer market in the early 1980s, when the orphaning of a widely-adopted operating system occurred. We find that the data characterizing this event are consistent with our theoretical framework.
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|Date of creation:||1995|
|Date of revision:|
|Contact details of provider:|| Postal: Israel TEL-AVIV UNIVERSITY, THE FOERDER INSTITUTE FOR ECONOMIC RESEARCH, RAMAT AVIV 69 978 TEL AVIV ISRAEL.|
Web page: http://econ.tau.ac.il/foerder/about
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"Complementary network externalities and technological adoption,"
International Journal of Industrial Organization,
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411, Massachusetts Institute of Technology (MIT), Department of Economics.
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- Timothy F. Bresnahan & Shane Greenstein, 1997.
"Technological Competition and the Structure of the Computer Industry,"
97028, Stanford University, Department of Economics.
- Bresnahan, Timothy F & Greenstein, Shane, 1999. "Technological Competition and the Structure of the Computer Industry," Journal of Industrial Economics, Wiley Blackwell, vol. 47(1), pages 1-40, March.
- Arthur, W Brian, 1989. "Competing Technologies, Increasing Returns, and Lock-In by Historical Events," Economic Journal, Royal Economic Society, vol. 99(394), pages 116-31, March.
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