The Relationship between the Network Externalities of Complementary Modularity

Abstract:

This paper adds to the growing literature on the vertically specialized collaboration of modularity firms by applying a model in which complement and core products collaborate with each other in a network situation. More specifically, it investigates the influence of the complement’s network strength on the equilibrium price and output of the core product. The results thus characterize the relationship between the complement’s and the core products’ network strength during collaboration.

• Periodical: Key Engineering Materials (Volume 486)
• Pages: 313-316
• DOI: https://doi.org/10.4028/www.scientific.net/KEM.486.313
• Online since: July 2011
• Authors: Zu Ying Huang, Xing Liu
• Keywords: Impetus, Modularity, Network Externalities, Stackelberg Game, Substitution

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[5] Information on http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1795260.