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Network externalities, competition, and compatibility

Michael L. Katz
- 01 Jan 1985 - 
- Vol. 75, Iss: 3, pp 424-440
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This article is published in The American Economic Review.The article was published on 1985-01-01 and is currently open access. It has received 6100 citations till now. The article focuses on the topics: Network economics.

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Mobile Termination, Network Externalities and Consumer Expectations

TL;DR: In this article, the authors re-examine the literature on mobile termination in the presence of network externalities and show that consumers' expectations are assumed passive but required to be fulfilled in equilibrium (as defined by Katz and Shapiro, AER 1985).
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Network effects, market structure and industry performance ✩

TL;DR: The authors analyzes oligopolistic markets with network externalities and proves the existence of non-trivial fulfilled-expectations equilibrium by exploiting a minimal complementarity structure on the model primitives that allows for pure network goods.
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When Does a Platform Create Value by Limiting Choice

TL;DR: In this paper, the authors present a theory for why it might be rational for a platform to limit the number of applications available on it, based on the observation that even if users prefer application variety, applications often also exhibit direct network effects.
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Factors for winning format battles: A comparative case study

TL;DR: A new framework of factors that impact the outcome of format battles between competing interface formats is proposed, which appears to be more complete than earlier frameworks, and therefore provides a better understanding of interface format battles.
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Network externalities and the Coase conjecture

TL;DR: In this article, the effect of market structure on the development of a network in a dynamic model with rational expectations is examined in a model of durable good production in the presence of network externalities.
References
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Monopoly, quality, and regulation

TL;DR: In this paper, the authors argue that under regimes of monopoly and monopolistic competition, product characteristics (which are often endogenous variables) are not usually optimally set under the pressure of market forces, and that regulation is also beset with difficulties when price and quality are decision variables.
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Critical Mass and Tariff Structure in Electronic Communications Markets

TL;DR: In this article, the authors developed an economic model that determines both the required critical mass size for startup and the ultimate expansion level of such a system and evaluated the effects of different pricing structures for the service under the assumption that users maximize benefits minus cost and a monopoly supplier maximizes profit.
Posted Content

Tax Analysis in an Oligopoly Model

TL;DR: In this article, the authors use the conjectural variations model of oligopoly to analyze the way in which the incidence of a tax depends upon the pattern of firm interaction and show that the errors that arise in excess burden calculations when incorrect assumptions on market structure are made.
Journal ArticleDOI

Tax Analysis in an Oligopoly Model

TL;DR: In this paper, the authors use the conjectural variations model of oligopoly to analyze the way in which the incidence of a tax depends on the pattern of firm interaction and show that the errors that can arise in excess burden calculations when incorrect assumptions on market structure are made.