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Given a product or service, the number of its installed user base has a significant positive effect on the existing users’ loyalty and new users’ conversion. This effect is conceptualized as network externalities in economics. Network externalities are supposed to be particularly striking in nowadays online business-to-business (B2B) platforms, but yet the mystery behind their effects on user loyalty to online B2B platforms remains to be delicately unraveled. The purpose of this paper is to discover the factors driving users’ loyalty, especially buyers’ loyalty, to online B2B platforms, by highlighting the impacts of network externalities on loyalty and other mediating factors.

A conceptual model of buyer loyalty under network externalities is elaborated. The reliability and validity of the instruments of the latent model constructs are assessed by confirmatory factor analysis, and the hypothesized causal relationships among the constructs are tested by structural equation modeling, on 710 valid buyer samples collected from a famous online B2B platform in China.

The analysis demonstrates that: perceived value, user satisfaction and switching costs are the major predictors of buyer loyalty to online B2B platforms characterized by network externalities; network externalities positively account for buyer loyalty by contributing to perceived value, user satisfaction and switching costs; and direct network externality (measured by perceived network size and perceived external prestige) has a significant effect on indirect network externality (measured by perceived compatibility and perceived complementarity).

The findings allow the authors to conclude meaningful managerial implications for online B2B service providers to build up loyal user bases through improving users’ perceptions of network externalities, switching costs and value.

Few issues in recent times have so provoked debate and dissention within the library field as has the concept of fees for user services. The issue has aroused the passions of our profession precisely because its roots and implications extend far beyond the confines of just one service discipline. Its reflection is mirrored in national debates about the proper spheres of the public and private sectors—in matters of information generation and distribution, certainly, but in a host of other social ramifications as well, amounting virtually to a debate about the most basic values which we have long assumed to constitute the very framework of our democratic and humanistic society.

This study aims to investigate the influences of loyalty and switching costs toward a firm's overall post-adoption behavior in using information system.

A research model is developed around two constructs found in the literature – loyalty and switching costs – that are most critical in firms' decisions on continued use of the same IS service providing company. It is empirically tested using a survey of IT decision makers in total 102 companies in South Korea. Partial least squares method is used to assess the relationships specified in research model.

The findings suggest that both loyalty and switching costs have positive influences on the continuous intention to use and the inattentiveness of alternatives.

Findings are based on a single point cross-sectional survey. To further investigate the continuance of specific IT service firms, triangulation will be necessary with longitudinal and qualitative data concerning the process of decision-making, including political and contractual situation.

The study fills the research gap in studying post-adoption behavior at the firm level by empirically testing the duality of loyalty and switching costs.

This paper aims to investigate the investment strategy of a two-sided platform on reducing transaction costs of two user sides and to study the pricing problem of the platform.

Mathematical derivation is used to compute the optimal decisions of a two-sided platform on pricing and investment. Numerical analysis is used to illustrate the findings.

It is found that the demand of one user side decreases in the maximal transaction costs reduction to this side but increases in the maximal transaction costs reduction to the other side. It is also found that a platform should never choose the investment in such a way that the maximal transaction costs reductions of two user sides are the same.

Several limitations exist in this paper, most of which exist due to the assumptions. These limitations could be good research directions in the future. For example, only one platform’s decision is considered, and platforms’ competition is not taken into account. Considering other platforms’ competition, the decisions of the users and the platform would be different.

From the transaction costs perspective, this paper finds that a platform should never choose the investment in such a way that the maximal transaction costs reductions of two user sides are the same. This conclusion has not been found in previous literature.

Social networking sites (SNS) follow the same diffusion pattern and are subject to the same phenomena as other technologies (e.g. QWERTY keyboard, Microsoft Office and VHS) that were subject to increasing returns. Since they may lock-in users, increasing returns significantly alter the way a technology is used and should be managed. The purpose of this paper is thus to verify if SNS are subject to increasing returns and, if so, to better understand their impacts in this context.

A research model that combines path dependency theory (PDT) tenets with the push-pull-mooring (PPM) model of information technology (IT) switching was developed and tested with data collected from 416 SNS users via a field survey. Participants were voluntary students at a North American university enrolled in a compulsory undergraduate course in business administration. Partial least square analysis structural equation modeling (PLS-SEM) was used to validate our research model and test our hypotheses.

Results show that SNS are subject to three forms of increasing returns: those stemming from device complementarity, learning and adaptive expectations. In addition, the findings show that increasing returns stemming from SNS use have the potential to lock-in SNS users by increasing their switching costs.

SNS users should be careful when using an SNS since such use can create a path that is self-reinforced and that can lock them due to the increasing returns it yields. SNS vendors/providers need to learn how to manage increasing returns if they want to foster continued use of their SNS and/or poach users from their competitors. Lastly, SNS regulators should revise or put in place new governance mechanisms since increasing returns, when properly leveraged, may undermine fair competition by allowing companies to lock-in users and lock-out competitors.

This study contributes to IS research by: (1) empirically demonstrating that increasing returns are present in the context of SNS use, (2) identifying increasing returns as key antecedents of user switching costs, (3) validating a theoretical framework that allows for the appraisal of PDT tenets in a variance model and (4) instantiating PDT tenets at the individual level.

This chapter introduces a simulation model to estimate the social costs of problem drug misusers in England and Wales, and how policies to increase the number of drug users in treatment may impact on both social costs and government expenditure. Consequences are divided into five domains – health, crime, social care, work, and driving. Social costs are estimated to be between £12 and £12.3 billion, and the total cost of government expenditure is around £3.5 billion. Increases in the numbers in treatment, are estimated to reduce social costs across a 5-year period by between £3.0 and £4.4 billion.

The purpose of this paper is to reveal the impact of usability and switching costs on user intention to switch information systems (IS), and to examine the mediating role of switching costs on the usability-intention to switch relationship.

Using structural equation modeling, the research hypotheses tested in the context of forecasting IS using a web-based survey of 205 business forecasters.

Results show that both perceived usability and switching costs negatively affect intention to switch; and switching costs, through specific constructs, mediate the relationship between usability and intention to switch IS.

Further research is needed for a more comprehensive understanding of the role of switching costs and to test the model in a longitudinal study and across different types of IS.

This research contributes to a better understanding of the interplay between usability and switching costs factors and their impact on IS switching user intention. Based on the study findings, theoretical and practical implications for IS are identified and discussed.

This paper aims to use the user costs approach to identify the periods of over- and under-valuation in the Baltic residential real estate markets.

Three alternative estimates of the user costs of homeownership in the Baltics are computed: one that does not discriminate between the leveraged and unleveraged parts of a house and the other that takes loan-to-value ratios into account.

The approach successfully identifies the overheating that took place in the Baltic real estate markets prior to the crisis of 2009 and shows that there is significant upward pressure for the housing prices in the Baltics in the low interest rate environment that became prevalent ever since.

The paper uses only the current values of the fundamentals to compute the user costs. The framework could be augmented to account for the expected future developments of the fundamentals.

The macroprudential policy makers should monitor the developments in the Baltic residential real estate markets closely and be ready to act because an increase in the price-to-rent ratios might seem sustainable, given the current low interest rates, but could potentially bring harmful volatility when the monetary policy normalises.

This paper builds a novel data set on the real estate markets of the Baltic countries and is the first to derive the user costs of homeownership in the region. It is also among the first to identify periods of housing price misalignments from their fundamental values in the Baltic States.

The growth and usage of online information systems has resulted in institutions making statistical studies on the costs of providing this service to users. Vendors analyze their indirect and direct costs in making database services available. This paper deals with the economies of online retrieval costs to the institution as well as the end user. One cost factor on which little has been reported, due to a paucity of data, is the value of the time saved by the end user in having a computer search run. Information which indicates savings to the end user will be reported from evaluations of completed searches run by the Purdue University Library's Computer Based Information Service. To measure overall benefits, institutions should consider the volume of usage, system performance and effectiveness, user behavior and user satisfaction.

Social media networks make their services freely available to all users. Users pay for the service received with the time and attention taken by the advertisements. This chapter argues that social media platforms are a unique form of monopoly driven by “the more the merrier” effect (i.e., network effects) in users' consumption. These monopolies exercise market power, not by charging higher prices to users but by “tying” larger amounts of advertising to their content. Traditional antitrust instruments designed to address excessive pricing and reduced output by monopolies need to be reframed to tame the attention economy problems in the social media industry. This chapter discusses five antitrust instruments grouped in three categories: structural, behavioral, and market-based remedies. Market-based solutions are the least explored in the literature, despite being the most promising instruments to lower the attention costs imposed on users, while preserving the economies of scope in production and the network effects in consumption, and possibly maintaining free access to social media, as we know it today.