Article

Should I stay or should I go? Migrating away from an incumbent platform

Jacques Crémer, Gary Biglaiser et André Veiga

Résumé

We study incumbency advantage in markets with positive consumption externalities. Users of an incumbent platform receive sto- chastic opportunities to migrate to an entrant and can either accept them or wait for a future opportunity. In some circumstances, users have incentives to delay migration until others have migrated. If they all do so, no migration takes place, even when migration would have been Pareto-superior. We use our framework to identify environments where incumbency advantage is larger. A key result is that having more migration opportunities actually increases incumbency advantage.

Mots-clés

Platform; Migration; Standardization and Compatibility; Industry Dynamics;

Codes JEL

  • D85: Network Formation and Analysis: Theory
  • L14: Transactional Relationships • Contracts and Reputation • Networks
  • R23: Regional Migration • Regional Labor Markets • Population • Neighborhood Characteristics
  • L15: Information and Product Quality • Standardization and Compatibility
  • L16: Industrial Organization and Macroeconomics: Industrial Structure and Structural Change • Industrial Price Indices

Remplace

Gary Biglaiser, Jacques Crémer et André Veiga, « Should I stay or should I go? Migrating away from an incumbent platform », TSE Working Paper, n° 21-1281, décembre 2021.

Référence

Jacques Crémer, Gary Biglaiser et André Veiga, « Should I stay or should I go? Migrating away from an incumbent platform », The RAND Journal of Economics, vol. 53, n° 3, août 2022, p. 453–483.

Publié dans

The RAND Journal of Economics, vol. 53, n° 3, août 2022, p. 453–483