FUNCTIONAL DEGRADATION AND ASYMMETRIC NETWORK EFFECTS*
研究了在网络效应市场中，企业为何及何时会推出功能降级的低价或免费产品，并分析了这种做法的福利影响。
In markets subject to network effects, firms often remove some functions of their original products and sell a functionally-downgraded version at a lower or zero price. This paper aims to provide a pure network effect based explanation of such a practice. Building a functional degradation model with asymmetric network effects, we investigate when and why firms have incentives to introduce a functionally-degraded good and discuss its welfare implication.