Network Externalities

2 years ago
Microeconomics

Network externality – Situation in which each individual’s demand depends on the purchases of other individuals.

Bandwagon effect – Positive network externality in which a consumer wishes to process a good in part because others do.

Snob effect – Negative network externality in which a consumer wishes to own an exclusive or unique good.

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Bijay Satyal
Bijay Satyal
Dec 1, 2021
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