IMG_0003_NEW_0018 - the willingness to pay- Eventually only...

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,- T M;iket.wi{h- Netwoik - ' Externalities N= number of users (size of network) P= Pri€ orwillingnessto pay Consider a market where the willingnessto pay ofthe marginal consumer (D) depends on the number of other users (N). lnitially, more users indease
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Unformatted text preview: the willingness to pay- Eventually only price-sensitive 6nsumers are Ieft. The supply curue (S) reflects the ost of producing the good. There are threJ potential equilibria: 0, N'l and N2; only the latter is stable...
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This note was uploaded on 12/29/2011 for the course ECON 6 taught by Professor Dianne during the Fall '10 term at Simon Fraser.

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