Network externalities between carriers or machines:How they work in the smartphone industry

Ryoma Kitamura ()

No 117, Discussion Paper Series from School of Economics, Kwansei Gakuin University

Abstract: In this paper, we consider a duopoly model where two firms sell two differentiated products and there is a network externality between either carriers or machines. We derive the equilibria of these games and illustrate the effects of a change in quality on the equilibrium quantity of each good. Furthermore, we compare fully compatible and incompatible equilibrium outcomes and discover some insights on relations between them. Such insights were not found in earlier studies that considered only the network externality between carriers.

Keywords: Smartphone market; Multi-product firm; Duopoly; Cannibalization; Network externality (search for similar items in EconPapers)
JEL-codes: D21 D43 L13 L15 (search for similar items in EconPapers)
Pages: 27 pages
Date: 2014-03, Revised 2014-03
New Economics Papers: this item is included in nep-bec, nep-com, nep-ind and nep-net
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http://192.218.163.163/RePEc/pdf/kgdp117.pdf First version, 2014 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:kgu:wpaper:117

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