Article
Growing like Google: Endogenous Growth with Global Network Externalities
Department of Economics Working Papers
(2021)
Abstract
We study endogenous growth in the presence of domestic and international network externalities. In our model, network externalities provide natural protection to first movers and incentivize disruptive innovations without the need for patent protection. Domestic and global growth depends on the extent of network externalities, international compatibility costs, and anti-trust policies. We find that traditional anti-trust policies may lead to unintended outcomes. Policies such as banning price discrimination or collusion may reduce economic growth. In particular, price discrimination and collusion could increase economic growth when network externalities are large in relation to compatibility costs.
Disciplines
Publication Date
July 16, 2021
Publisher Statement
Number: 21009
Original Release Date: July 16, 2021
Length: 42 pages
Citation Information
Juan Carlos Cordoba and Sicheng He. "Growing like Google: Endogenous Growth with Global Network Externalities" Department of Economics Working Papers (2021) Available at: http://works.bepress.com/juancarlos-cordoba/22/