Do Converters Facilitate the Transition to a New Technology?: A Dynamic Analysis of Coverters

Choi, Jay Pil

This paper analyzes the process of transition in standards between incompatible technologies when converters are available. Contrary to a common presumption that converters facilitate the transition from an old technology to an otherwise incompatible new technology, I find circumstances in which the possibility of transition is blockaded by the existence of converters. When there are changes in the adoption behavior due to the existence of converters, I also analyze the welfare consequences of the changes in the adoption regimes. In the welfare analysis of converters, a distinction is made between ex ante and ex post efficiency.



More About This Work

Academic Units
Department of Economics, Columbia University
Department of Economics Discussion Papers, 716
Published Here
February 28, 2011


December 1994.