paper No. 00-51
Economic theories of network effects have a number of testable implications.
Testing of the theory by econometric methods, however, has proved difficult. I turn to
documentary methods in order to test the theory, drawing on the body of documents used
as evidence in U.S. vs. Microsoft. Analysis strikingly similar to the theory, including not
only the main implications but also key analytical distinctions, guides business decision
making. The same analysis suggests several interesting areas in which the theory is
incomplete. Document based research raises a number of novel methodological issues.
The Economics of the Microsoft Case
Timothy F. Bresnahan
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