Network Externalities and Standardization: A Classroom Demonstration.
This paper presents a classroom game that can be used to demonstrate network externalities, standardization, and switching costs. In the basic game, students independently choose a technology whose value depends on the total number of students choosing that technology. In the next round, sequential...
| Published in: | Southern Economic Journal Vol. 69; no. 4; pp. 1000 - 1009 |
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| Main Authors: | , , |
| Format: | Article |
| Published: |
Southern Economic Association
April 2003
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| Subjects: | |
| Online Access: | View this record in EBSCOhost |
| fields | @attributes: recordID: 1 pdfLink: plink: https://search.ebscohost.com/login.aspx?direct=true&db=ssf&AN=510238080&site=ehost-live header: @attributes: shortDbName: ssf uiTerm: 510238080 longDbName: Social Sciences Full Text (H.W. Wilson) uiTag: AN controlInfo: bkinfo: jinfo: jid: 00384038 SEJ jtl: Southern Economic Journal issn: 00384038 maglogo: N pubinfo: dt: April 2003 vid: 69 iid: 4 pid: 1482 pub: Southern Economic Association artinfo: ui: 510238080 10.2307/1061664 ppf: 1000 ppct: 9 formats: fmt: @attributes: type: T tig: atl: Network Externalities and Standardization: A Classroom Demonstration. aug: au: Ruebeck, Christopher Stafford, Sarah Tynan, Nicola su: Externalities Economics education Experimental economics Information technology & economics sug: subj: Externalities Economics education Experimental economics Information technology & economics ab: This paper presents a classroom game that can be used to demonstrate network externalities, standardization, and switching costs. In the basic game, students independently choose a technology whose value depends on the total number of students choosing that technology. In the next round, sequential decision making is allowed that quickly leads to standardization. Introducing imperfect information and switching costs into subsequent rounds can lead to the real-world phenomenon of an inferior technology becoming the standard. This exercise can be used in principles of economics classes to teach these important concepts without requiring mathematical models. In more advanced classes, construction of the mathematical model behind the game may be assigned. Reprinted by permission of the publisher. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: N holdings: @attributes: islocal: N |
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