We introduce a simple model of technology adoption with overlapping generations of players. Technologies generate network effects, and players are both backward- and forward-looking. We use results from the supermodular games literature to guarantee equilibrium existence and uniqueness. In line with the empirical literature, the equilibrium adoption path exhibits hysteresis and technologies cannot lock-in. We characterize the expected time of adoption, which can be seen as a measure of technology dominance.

Technology adoption: hysteresis and absence of lock-in

COLLA, PAOLO;
2016

Abstract

We introduce a simple model of technology adoption with overlapping generations of players. Technologies generate network effects, and players are both backward- and forward-looking. We use results from the supermodular games literature to guarantee equilibrium existence and uniqueness. In line with the empirical literature, the equilibrium adoption path exhibits hysteresis and technologies cannot lock-in. We characterize the expected time of adoption, which can be seen as a measure of technology dominance.
2016
2016
Colla, Paolo; Garcia, Filomena
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11565/3986375
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