Abstract
This article analyzes a technology adoption process in which the effect of informational spillover interacts with network externalities. The interplay of informational externalities and payoff interdependency induces risk-averse and clustering behavior in the technology-adoption process. The analysis differs from the herd behavior literature in focusing on how the herd behavior of subsequent users influences the initial adoption decision. Moreover, herd behavior in this article stems from each agent's desire to inhibit the revelation of new information that can be used in a way detrimental to her, rather than from each agent's effort to free-ride on information contained in the decisions made by predecessors.
| Original language | English |
|---|---|
| Pages (from-to) | 407-425 |
| Number of pages | 19 |
| Journal | RAND Journal of Economics |
| Volume | 28 |
| Issue number | 3 |
| DOIs | |
| Publication status | Published - 1997 Jan 1 |
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All Science Journal Classification (ASJC) codes
- Economics and Econometrics
Cite this
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Herd behavior, the "penguin effect," and the suppression of informational diffusion : An analysis of informational externalities and payoff interdependency. / Choi, Jay Pil.
In: RAND Journal of Economics, Vol. 28, No. 3, 01.01.1997, p. 407-425.Research output: Contribution to journal › Article
TY - JOUR
T1 - Herd behavior, the "penguin effect," and the suppression of informational diffusion
T2 - An analysis of informational externalities and payoff interdependency
AU - Choi, Jay Pil
PY - 1997/1/1
Y1 - 1997/1/1
N2 - This article analyzes a technology adoption process in which the effect of informational spillover interacts with network externalities. The interplay of informational externalities and payoff interdependency induces risk-averse and clustering behavior in the technology-adoption process. The analysis differs from the herd behavior literature in focusing on how the herd behavior of subsequent users influences the initial adoption decision. Moreover, herd behavior in this article stems from each agent's desire to inhibit the revelation of new information that can be used in a way detrimental to her, rather than from each agent's effort to free-ride on information contained in the decisions made by predecessors.
AB - This article analyzes a technology adoption process in which the effect of informational spillover interacts with network externalities. The interplay of informational externalities and payoff interdependency induces risk-averse and clustering behavior in the technology-adoption process. The analysis differs from the herd behavior literature in focusing on how the herd behavior of subsequent users influences the initial adoption decision. Moreover, herd behavior in this article stems from each agent's desire to inhibit the revelation of new information that can be used in a way detrimental to her, rather than from each agent's effort to free-ride on information contained in the decisions made by predecessors.
UR - http://www.scopus.com/inward/record.url?scp=0040007877&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=0040007877&partnerID=8YFLogxK
U2 - 10.2307/2556022
DO - 10.2307/2556022
M3 - Article
AN - SCOPUS:0040007877
VL - 28
SP - 407
EP - 425
JO - RAND Journal of Economics
JF - RAND Journal of Economics
SN - 0741-6261
IS - 3
ER -