nep-net New Economics Papers
on Network Economics
Issue of 2008‒02‒23
five papers chosen by
Yi-Nung Yang
Chung Yuan Christian University

  1. Competitive intelligence and network mapping of interfirm alliances By Brigitte GAY (LEREPS-GRES & Toulouse Business School)
  2. Open Source Licensing in Mixed Markets, or "Why Open Source Software Does Not Succeed" By Alexia Gaudeul
  3. When Clusters become Networks By Sandra Phlippen; Bert van der Knaap
  4. Inter-modal Network Externalities and Transport Development: Evidence from Roads, Canals, and Ports during the English Industrial Revolution By Dan Bogart
  5. The Transaction Costs Perspective on Standards as a Source of Trade and Productivity Growth By Frank A.G. den Butter; Stefan P.T. Groot; Faroek Lazrak

  1. By: Brigitte GAY (LEREPS-GRES & Toulouse Business School)
    Abstract: In many industries, networks, rather than firms, have become the organizing level at which firms compete with each other. One role of competitive intelligence is to help firms understand their global environment as well as master their position in a number of industrial sectors. The pertinence of a firm strategy and position in the different segments it is involved in, can be analyzed by mapping the complex alliance networks that characterize industries today. These tools enable also a tech watch of individual, highly innovative, sectors as well as understand the links between countries and the positions of the nations themselves in the global environment.
    Keywords: Alliance, network, mapping, biotechnology, competition
    JEL: L14 O3
    Date: 2008
  2. By: Alexia Gaudeul (School of Economics and Centre for Competition Policy, University of East Anglia)
    Abstract: The rivalry between developers of open source and proprietary software encourages open source developers to court users and respond to their needs. The open source developer who wants to promote her code (intrinsic motivations) may choose liberal license terms such as those of the Berkeley Software Distribution as they allow the proprietary developer to use her code in his product and thus broaden its appeal. If she wants to promote her own implementation of her software (extrinsic motivations), she may use more restrictive license terms such as the General Public License to discourage proprietary exploitation of her code. An open source developer who is a latecomer to the market will be less likely than an early entrant to make her product compatible with that of the proprietary developer, but she is also more likely to orient her software towards the end user.
    Keywords: open source, software, standards, compatibility, network effects, duopoly, mixed markets, production systems, non profits, volunteer organizations, information goods, intellectual property, copyright, licensing
    JEL: D23 H41 L13 L22 L31 L86 O34 O38
    Date: 2008–02
  3. By: Sandra Phlippen (Erasmus University Rotterdam); Bert van der Knaap (Erasmus University Rotterdam)
    Abstract: Policy makers spend large amounts of public resources on the foundation of science parks and other forms of geographically clustered business activities, in order to stimulate regional innovation. Underlying the relation between clusters and innovation is the assumption that co-located firms engaged in innovative activities benefit from knowledge that diffuses locally. In order to access this knowledge, firms are often required to form more- or less formal relations with co-located firms. Empirical evidence shows however that besides some success cases like Silicon Valley and the Emilia- Romagna region where firms collaborate intensively, many regional clusters are mere co-locations of firms. To enhance our understanding of why some clusters become networks of strategic collaboration and others don’t, we study link formation within European biopharmaceutical clusters. More specifically we look at the effect of cluster characteristics such as number of start-up firms, established firms or academic institutions, or the nature of the collaborations on the probability of local link formation
    Keywords: regional clusters; networks; local & global linkages; pharmaceutical industry
    JEL: R11 R12 R58 D83 D85
    Date: 2007–12–20
  4. By: Dan Bogart (Department of Economics, University of California-Irvine)
    Abstract: How does the development of one transport mode influence the development of another? This paper uses time-series data to test whether inter-model network externalities influenced the development of road, canal, and port infrastructure in England from 1760 to 1830. The main finding is that road development had a positive effect on canal development. The results suggest that the option value of investing in a canal in the future diminished when nearby road improvements were initiated because there was less uncertainty about future profits from canal tolls. They also suggest a reinterpretation of road transport in the Industrial Revolution and point to the general importance of inter-modal network externalities.
    Keywords: Inter-modal network externalities; British transport; Industrial Revolution
    JEL: R40 R50 N73
    Date: 2008–02
  5. By: Frank A.G. den Butter (VU University Amsterdam); Stefan P.T. Groot (VU University Amsterdam); Faroek Lazrak (VU University Amsterdam)
    Abstract: This paper discusses the design, implementation and use of standards from the perspective of transaction costs economics. A proper design and implementation of standards may lead to a considerable reduction of transaction costs, which enhances trade and, consequently, economic welfare. A major example is the use of containers, which has drastically changed the worldwide transport infrastructure, and lowered the costs of transport of goods considerably. The example of containers also shows that network externalities play a major role in the use of standards, and that, on the other hand, worldwide standards with large sunk investment costs may lead to a lock-in. This may call for government intervention in the design and use of standards, and in the transition processes to new standards. The paper provides ample further examples of standards and on the role of the government, or clubs, with respect to these standards.
    Keywords: standards; transaction costs; innovations; lock-ins; network externalities; international trade
    JEL: L15 L16 L17
    Date: 2007–11–23

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