We study the effect of voting when insiders’ public goods provision may affect passive outsiders. Without voting insiders’ contributions do not differ, regardless of whether outsiders are positively or negatively affected or even unaffected. Voting on the recommended contribution level enhances contributions if outsiders are unaffected and internalizes the negative externality by lowering contr...

We develop a model of innovation in which entrepreneurs develop a new (differentiated) product market that is subsequently exploited by a well-established firm that “stretches” its brand to enter the new market as a “fast second”. In this setting, there is a positive externality to the pioneering efforts of the initial entrants that may well increase with the number of such entrants. We develop...

We investigate a private value auction in which a single “entrant”on winning imposes a negative externality on two “regular”bidders. In an English auction when all bidders are active, “regular” bidders free ride, exiting before price reaches their values. In a …rst-price sealed-bid auction incentives for free riding and aggressive bidding coexist, limiting free riding compared to the English au...

The social learning network (SLN) constructed based on web 2.0 techniques demonstrates some unique characteristics comparing to traditional e-learning context based on 1.0 technique. In response to the new characteristics in SLN, we advance the theoretical understanding of user satisfaction by reconceptualising e-learning as a relational process among students. Based on that, we draw on network...

The size of the intrahousehold externality created when a literate household member provides literacy services to illiterate members is estimated in this paper, using a model of children’s heightfor-age in Papua New Guinea. This externality appears to be large. These results support the use of a new measure of literacy, developed by Basu and Foster (1998) to take account of the gains when illit...

Retaining users and facilitating their continuance usage are essential for mobile service providers to increase both revenues and profits. This research integrates the perspectives of network externality and switching costs to propose a model for investigating the continuance usage of mobile instant messaging services. Network externality arises from both direct and indirect sources and is conc...

Pecuniary externalities have regained the interest of researchers as they seek policy interventions and regulations to remedy externality-induced distortions, e.g., balance sheet effects, amplifiers and fire sales. We show how bundling, exclusivity and additional markets internalize these pecuniary externalities; ex ante competition can achieve a constrained-efficient allocation. We cover a lar...

It is difficult to resolve the global warming free-rider externality problem by negotiating n different quantity targets. By contrast, negotiating a single internationally binding minimum carbon price (the proceeds from which are domestically retained) counters self-interest by incentivizing agents to internalize the externality. The model of this article indicates an exact sense in which each ...