Path Dependence: Determinants and Impacts of Technology Adoption

Simeon Simeonov
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Simeon Simeonov: University of World and National Economy, Sofia, Bulgaria

Economic Alternatives, 2020, issue 2, 300-310

Abstract: Today’s world heavily relies on sustained technological advancements. Yet, consumers’ preferences for one technology over another are not necessarily predicated on transparent or rational reasons. That is, in a sequence of events later decisions are not entirely independent on previous ones. Historical choice patterns paired with positive feedback may subsequently reinforce one’s entrenched ways of thinking. This resultant contingency, referred to as path dependence, may tip the balance in favor of one particular piece of technology over more superior ones. A better comprehension of the phenomena in terms of technology adoption suggests a greater probability of attaining the most optimal outcome. Thereby, the current paper aims to address the subtle corresponding determinants and impacts of technology adoption. Relevant studies thereat were selected, critically assessed, and integrated into the follow-up literature review. A thorough view at the inferior QWERTY keyboard attributed its entrenchment on a market level to three interrelated factors: technical interrelatedness, system scale economies, and quasi-irreversibility of investment. Although more superior alternatives were available, the QWERTY keyboard layout is nowadays a leading standard worldwide.

Keywords: path dependence; technology adoption; initial conditions; positive feedback; QWERTY keyboard (search for similar items in EconPapers)
JEL-codes: D11 D91 E11 O33 (search for similar items in EconPapers)
Date: 2020
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