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The Economics of Networks Internet Site
Economides‘ Site presents a collection of information on economic issues of networks, such as the internet, telephone and fax communications networks, the railroad network, the airline network, as well as financial exchange and credit card networks. One of the fundamental features of networks is that the value of a network service increases as the network expands, i.e., networks exhibit network externalities.
Since large network size is desirable, smaller networks have incentives to interconnect and form a larger network of networks. Today's telephone network in the U.S. and internet are two good examples of networks made of sub-networks. Interconnection requires technical compatibility and often it is made with specific interconnection fees paid by one sub-network to another. The issues of compatibility and interconnection fees are crucial for the success of a network of networks. They are discussed in a number of the papers Economides offers on his site.