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Please use this identifier to cite or link to this item:
http://hdl.handle.net/2451/28483
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| Title: | Lock-In and Unobserved Preferences in Server Operating System Adoption:
A Case of Linux vs. Windows |
| Authors: | Hong, Seung-Hyun - University of Illinois
Rezende, Leonardo - PUC-Rio and University of Illinois |
| Issue Date: | 2007 |
| Series/Report no.: | NET Institute Working Paper;07-05 |
| Abstract: | This paper attempts to distinguish state dependence (or lock-in) from
unobserved preferences in the decision to adopt Linux or Windows as the
operating system for computer servers. To this end, we use detailed
survey data of over 100,000 establishments in the United States. Without
accounting for unobserved heterogeneity in establishment-specific
preferences for operating systems, we find a strong positive correlation
between the current choice and the previous choice, suggesting
potentially high switching costs and lock-in. To account for unobserved
preferences for either operating system, we impose weak identifying
assumptions and employ recently developed dynamic discrete choice panel
data methods (Arellano and Carrasco 2003). The results show little or no
evidence of state dependence, implying that unobserved preferences,
rather than switching costs and lock-in, are more important factors in
the adoption decision. Once taste heterogeneity is taken into account,
we additionally find little evidence of network effects between server
operating systems and non-server operating systems. |
| URI: | http://hdl.handle.net/2451/28483 |
| Appears in Collections: | NET Institute Working Papers Series
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