Reconsideration of the winner-take-all hypothesis: Complex networks and local bias

• 成果类型: Article
• 署名作者: Lee, Eocman; Lee, Jeho; Lee, Jongseok
• 署名单位: Korea Advanced Institute of Science & Technology (KAIST); Hallym University
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.1060.0571
• 发表日期: 2006
• 页码: 1838-1848
• 关键词: network externalities; network; increasing returns; TECHNOLOGY; complexity

摘要

The literature on network effects has popularized a hypothesis that competition between incompatible technologies results in the winner-take-all outcome. For the survival of the firm in this sort of competition, the installed base has been emphasized. We argue that the validity of this hypothesis depends on how customers interact with one another (e.g., if they exchange advice or files). In some interaction networks, customers influenced by their acquaintances may adopt a lagging technology even when a lead technology has built a large installed base. The presence of such a local bias facilitates the persistence of incompatibilities. When local bias cannot be sustained in other interaction networks, one technology corners the market. Our study suggests that overemphasizing the installed base, while ignoring network structure, could mislead practitioners.