A.k.a., lock-in. See http://www.utdallas.edu/~liebowit/paths.html
for a discussion of this topic and so-called, path dependence
"Do economies and markets make remediable errors in the choice of products? Does the economy "lock-in" to these incorrect choices even when the knowledge that these choices are incorrect is readily available? The literature of path dependence may be understood to argue that these lock-ins and errors occur, even in a world characterized by voluntary decisions and individually maximizing behavior. In this paper we examine path dependence and illustrate three different forms of the term, each having a different implication regarding market errors and lock-in. Two of these meanings are common in the economy but provide no support for the claims that remediable errors occur. The third meaning, which does imply irremediable error, we show to be based on restrictive assumptions that are likely to be overcome in the real world. The analysis is illustrated by examining the market's choice of videorecorder formats."
len
-----Original Message-----
From: Didier PH Martin [mailto:]
This is a phenomenon Regis McKenna [1] calls the word or
mouth effect, other have called that the network effect. In fact a whole
sector of economics is about this topic (network economics). It basically
state that the more people are using a particular product, the more this
product will sell. This is also known in sociology or in behavioral finance
as the herd effect.
