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| Topic: |
Technology
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| Number of pages / Number of words: |
3 / 762 |
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Important questions in this context include the following. Do network effects exist within each competing product technology? What is the nature of these network effects? Are these network effects symmetric across firms? What are the implications of network effects on the outcome of competition among firms with incompatible technologies?
In this paper, we address these questions in the 16-bit home video game industry in which the dominant players were Nintendo and Sega...
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Following prior empirical research dealing with network effects, we explore these questions in the context of a single industry. While this approach limits the generalizability of our results, it does allow us to explicitly study the dynamics of the competitive interactions between a set of firms. Since our study deals with the competition between two dominant firms, we first develop a game theoretic model of competition...
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