Theory Behind USA v. Microsoft

[John Young <jya@pipeline.com>]

John Cassidy writes in the January 12 New Yorker mag
of the controversial economic theory which undergirds DoJ's 
antitrust action against Microsoft.

He cites a seminal 1984 paper by Brian Arthur, "Competing
Technologies and Lock-in by Historical Small Events: The
Dynamics of Choice Under Increasing Returns."

After years of disparagement the theory seems to have
caught on, at least at Justice and with others who oppose the
theory of free market determination of winners and losers.
Arthur argues that market dominance by inferior products
is possible, and cites MS-DOS as an example.

Arthur is now a scientist at the Santa Fe Institute. He says
his theory "stands a great deal of economics on its head."
One critic said to Arthur, "If you are right, capitalism can't
work."

For those unable to get the magazine, we offer a copy of
Cassidy's essay:

   http://jya.com/arthur.htm (33K)

A side note: the same issue has a short piece noting that
the early charges of militant conspiracy behind the OKC
bombing have disappeared from the trials of McVeigh and
Nichols, and proposes that an apology is due militants, 
militia and other paranoiac targets.