A Commentary on 'Is Microsoft a Monopolist?'

KIT SIMS TAYLOR Bellevue Community College - Department of Economics

Abstract:

Is Microsoft a monopolist? The application of standard economic theory to this problem may tell us more about standard economic theory than it does about information-sector monopolies. Economists who expect to make a meaningful contribution to our understanding of industries which enjoy strong network effects and extremely low marginal costs should start by tossing out Marshall and rereading Schumpeter. Applying marginal analysis to these new industries may demonstrate our cleverness, but it amounts to little more than piling new epicycles atop a dying paradigm.

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