Many economists do not believe that network externalities lock consumers into the use of products that have technology inferior to other, similar products.These economists believe that
A)consumers are always rational.
B)in practice, the gains from using a superior technology exceed the losses consumers incur from switching costs.
C)there is no good evidence that switching costs exist.
D)the government will prevent products with inferior technology from being sold to consumers.

Question

Quizplus · Accepted Answer

Economists believe that consumers will switch to a superior technology if the benefits outweigh the costs of switching, which includes not just monetary costs but also the time and effort involved in learning and adapting to the new technology. Therefore, network externalities are not strong enough to lock consumers into using inferior technology.

Many Economists Do Not Believe That Network Externalities Lock Consumers