Network-induced Lock-in - A choice experiment examining social-network-caused online user inertia

Abstract: This essay examines whether there is empirical evidence of greater switching costs, and consequently greater lock-in eects, in the choice between online services bearing social characteristics than in the choice between services lacking such social network characteristics. An online choice experiment was performed where respondents were asked to choose between consumption bundles consisting of either web search engines or social network websites. The dataset was evaluated using a chi-square test and a probit regression analysis to check for correlations with demographic variables. The results show that switching costs are signicantly higher for social network websites, and that the probability of switching increases with age.