This chapter summarizes the interdependence of network effects, compatibility standards and intellectual property rights (IPR) in the global economy. This interdependence is analyzed at the product market level and at the research and development level. The questions to be examined are: how IPR...

What determines competition dynamics in markets with indirect network effects? We analyze this question in a dynamic hardware-software framework, where software firms compete in quality upgrades. We identify market structure as a major determinant of competition dynamics. Indirect network...

How does the quality of national institutions that enforce the rule of law influence international trade? Anderson and Marcouiller argue that bad institutions located in the importer's country deter international trade because they enable economic predators to steal and extort rents at the...

This paper uses a Ricardian model to generate predictions about the influence of institutions on trade in differentiated (complex) and commoditized (simple) products and then uses a rich international trade data set for empirical tests. The model draws the distinction between the role of...

Some cultural goods, like clothes and films, are consumed socially and are thus characterized by the same consumption network externalities as languages. At the same time, producers of new cultural goods in any one country draw on the stock of ideas generated by previous cultural production in...

We incorporate demand-side considerations in trade in a systematic but straightforward way. We do so by focusing on the role of inequality in the determination of trade flows and patterns. With nonhomothetic preferences, when countries are similar in all respects but asset inequality, we find...

We find that ethnic Chinese networks, proxied by the product of ethnic Chinese population shares, increased bilateral trade more for differentiated than for homogeneous products. This suggests that business and social networks have a considerable quantitative impact on international trade by...

We incorporate demand-side considerations in trade in a systematic but straightforward way. We do so by focusing on the role of inequality in the determination of trade flows and patterns. With non-homothetic preferences, when countries are similar in all respects but asset inequality, we find...