Legal Implications of Network Economic Effects

Abstract

Economic scholarship has recently focused a great deal of attention on the phenomenon of network externalities, or network effects: markets in which the value that consumers place on a good increases as others buy the good.Though the economic theory of network effects is less than fifteen years old, and is still not thoroughly understood, network effects are increasingly playing a role in legal argument.Judges, litigators, and scholars have suggested that antitrust law, intellectual property law, telecommunications law, Internet law, corporate law, and contract law need to be modified to take account of network effects.Their arguments reflect a wide range of views about what network effects are and how courts should react to them.In this Article, we explore the application of network economic theory in each of these contexts.We suggest ways in which particular legal rules should-and should not-be modified to take account of network effects.We also attempt to draw some general conclusions about the role of network economic the- *

Cite this work

No public copy is stored for this record, so only the metadata is cited.

Stored only when both papers are in the corpus — 121 citations exist upstream.

Papers that cite the same references — the relational fallback while embeddings are still backfilling.