Shane M. Greenstein - Faculty & Research - Harvard Business School

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Shane M. Greenstein

Martin Marshall Professor of Business Administration

Technology and Operations Management
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Shane Greenstein is the Martin Marshall Professor of Business Administration and co-chair of the HBS Digital Initiative. He teaches in the Technology, Operations and Management Unit. Professor Greenstein is also co-director of the program on the economics of digitization at The National Bureau of Economic Research.

Encompassing a wide array of questions about computing, communication, and Internet markets, Professor Greenstein’s research extends from economic measurement and analysis to broader issues. His most recent book focuses on the development of the commercial Internet in the United States. He also publishes commentary on his blog, Digitopoly, and his work has been covered by media outlets ranging from The New York Times and The Wall Street Journal to Fast Company and PC World.

Professor Greenstein previously taught at the Kellogg School of Management, Northwestern University, and at the University of Illinois, Urbana/Champaign. He received his PhD from Stanford University in 1989 and his BA from University of California at Berkeley in 1983, both in economics. He continues to receive a daily education in life from his wife and children.

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The Commercialization of Internet Infrastructure

  2. Article | Telecommunications Policy

    The Persistence of Broadband User Behavior: Implications for Universal Service and Competition Policy

    Andre Boik, Shane Greenstein and Jeffrey Prince

    In several markets, firms compete not for consumer expenditure but consumer attention. We examine user priorities over the allocation of their time, and interpret that behavior in light of salient tensions in policy discussions over universal service, data caps, and related policy topics, such as merger analysis. Specifically, we use extensive microdata on user online choice to characterize the demand for the services offered online, which drives a household’s supply of attention. Our data cover a period of time that saw the introduction of many new and notable sites and new devices on which to access them. In our analysis, we assess “how” households supply their attention along various dimensions, such as their concentration of attention across the universe of sites and the amount of attention expenditure per domain visit. Remarkably, we find no change in “how” households allocated their attention despite drastically changing where they allocated it. Moreover, conditional on total attention expenditure, demographics entirely fail to predict our key measures of attention allocation decisions. We highlight several important implications, for policy and beyond, stemming from the persistence and demographic orthogonality of our novel attention measures.

    Keywords: broadband service; attention allocation; Consumer Behavior; Household; Internet; Competition; Policy;

    Citation:

    Boik, Andre, Shane Greenstein, and Jeffrey Prince. "The Persistence of Broadband User Behavior: Implications for Universal Service and Competition Policy." Telecommunications Policy 43, no. 8 (September 2019).  View Details
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  3. Article | Journal of Economic Perspectives

    Net Neutrality: A Fast Lane to Understanding the Tradeoffs

    Shane Greenstein, Martin Peitz and Tommaso Valletti

    The last decade has seen a strident public debate about the principle of "net neutrality." The economic literature has focused on two definitions of net neutrality. The most basic definition of net neutrality is to prohibit payments from content providers to internet service providers; this situation we refer to as a one-sided pricing model, in contrast with a two-sided pricing model in which such payments are permitted. Net neutrality may also be defined as prohibiting prioritization of traffic, with or without compensation. The research program then is to explore how a net neutrality rule would alter the distribution of rents and the efficiency of outcomes. After describing the features of the modern internet and introducing the key players, (internet service providers, content providers, and customers), we summarize insights from some models of the treatment of internet traffic, framing issues in terms of the positive economic factors at work. Our survey provides little support for the bold and simplistic claims of the most vociferous supporters and detractors of net neutrality. The economic consequences of such policies depend crucially on the precise policy choice and how it is implemented. The consequences further depend on how long-run economic trade-offs play out; for some of them, there is relevant experience in other industries to draw upon, but for others there is no experience and no consensus forecast.

    Keywords: Internet; Policy;

    Citation:

    Greenstein, Shane, Martin Peitz, and Tommaso Valletti. "Net Neutrality: A Fast Lane to Understanding the Tradeoffs." Journal of Economic Perspectives 30, no. 2 (Spring 2016): 127–150.  View Details
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  4. Book | 2015

    How the Internet Became Commercial: Innovation, Privatization, and the Birth of a New Network

    Shane Greenstein

    In less than a decade, the Internet went from being a series of loosely connected networks used by universities and the military to the powerful commercial engine it is today. This book describes how many of the key innovations that made this possible came from entrepreneurs and iconoclasts who were outside the mainstream—and how the commercialization of the Internet was by no means a foregone conclusion at its outset. Shane Greenstein traces the evolution of the Internet from government ownership to privatization to the commercial Internet we know today. This is a story of innovation from the edges. Greenstein shows how mainstream service providers that had traditionally been leaders in the old-market economy became threatened by innovations from industry outsiders who saw economic opportunities where others didn't—and how these mainstream firms had no choice but to innovate themselves. New models were tried: some succeeded, some failed. Commercial markets turned innovations into valuable products and services as the Internet evolved in those markets. New business processes had to be created from scratch as a network originally intended for research and military defense had to deal with network interconnectivity, the needs of commercial users, and a host of challenges with implementing innovative new services.

    Citation:

    Greenstein, Shane. How the Internet Became Commercial: Innovation, Privatization, and the Birth of a New Network. Princeton University Press, 2015.  View Details
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  5. Report | 2013

    Issues in Data Caps and Usage-Based Pricing

    Brad Burnham, Shane Greenstein, Neil Hunt, Kevin McElearney, Marc Morial, Dennis Roberson and Charles Slocum

    Citation:

    Burnham, Brad, Shane Greenstein, Neil Hunt, Kevin McElearney, Marc Morial, Dennis Roberson, and Charles Slocum. "Issues in Data Caps and Usage-Based Pricing." Report, U.S. Federal Communications Commission, Open Internet Advisory Committee, Economic Impacts Working Group, May 2013.  View Details
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  7. Other Unpublished Work | 2012

    Measuring the Broadband Bonus in 20 OECD Countries

    Shane Greenstein and Ryan McDevitt

    This paper provides estimates of the economic value created by broadband Internet using measures of new gross domestic product and consumer surplus. The study finds that the economic value created in 30 OECD countries correlates roughly with the overall size of their broadband economies. In addition, price and quality data from the United States suggest that widespread adoption of broadband Internet has occurred without a dramatic decline in prices, which reflects an unobserved increase in broadband quality that conventional government statistics do not capture.

    Citation:

    Greenstein, Shane, and Ryan McDevitt. "Measuring the Broadband Bonus in 20 OECD Countries." OECD Digital Economy Papers, No. 197, OECD Publishing, April 2012.  View Details
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  11. Chapter | Accelerating Energy Innovation: Insights from Multiple Sectors | 2011

    Nurturing the Accumulation of Innovations: Lessons from the Internet

    Shane Greenstein

    Citation:

    Greenstein, Shane. "Nurturing the Accumulation of Innovations: Lessons from the Internet." In Accelerating Energy Innovation: Insights from Multiple Sectors, edited by Rebecca Henderson and Richard G. Newell, 189–224. National Bureau of Economic Research Conference Report. University of Chicago Press, 2011.  View Details
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  16. Chapter | Handbook of Telecommunications Economics, Volume 2 | 2005

    The Economic Geography of Internet Infrastructure in the United States

    Shane Greenstein

    Citation:

    Greenstein, Shane. "The Economic Geography of Internet Infrastructure in the United States." Chap. 8 in Handbook of Telecommunications Economics, Volume 2: Technology Evolution and the Internet, edited by Sumit K. Majumdar, Ingo Vogelsang, and Martin Cave, 289–364. Elsevier/North-Holland, 2005.  View Details
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  27. Chapter | The Electronic Village | 1999

    Determinants of the Regional Distribution of Information Technology Infrastructure in the United States

    Shane Greenstein and Mercedes Lizardo

    Citation:

    Greenstein, Shane, and Mercedes Lizardo. "Determinants of the Regional Distribution of Information Technology Infrastructure in the United States." In The Electronic Village: Public Policy Issues of the Information Economy, edited by Dale Orr and Thomas Wilson. C.D. Howe Institute, 1999.  View Details
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The Economics of Digitization

  1. Article | Journal of Economic Perspectives

    The Basic Economics of Internet Infrastructure

    Shane Greenstein

    The internet's structure and operations remain invisible to most economists. What determines the economic value of internet infrastructure and the incentives to improve it? What are the open research questions for the most salient policy issues? This article reviews the basic economics of internet infrastructure, focusing attention on the economic questions motivated by public aspirations for ubiquitous availability and widespread adoption of internet protocols.

    Keywords: Internet; Infrastructure; Operations; Economics; Value;

    Citation:

    Greenstein, Shane. "The Basic Economics of Internet Infrastructure." Journal of Economic Perspectives 34, no. 2 (Spring 2020): 192–214.  View Details
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  2. Article | Information Systems Research

    Open Content, Linus' Law, and Neutral Point of View

    Shane Greenstein and Feng Zhu

    The diffusion of the Internet and digital technologies has enabled many organizations to use the open-content production model to produce and disseminate knowledge. While several prior studies have shown that the open-content production model can lead to high-quality output in the context of uncontroversial and verifiable information, it is unclear whether this production model will produce any desirable outcome when information is controversial, subjective, and unverifiable. We examine whether the open-content production model helps achieve a neutral point of view (NPOV) using data from Wikipedia's articles on U.S. politics. Our null hypothesis builds on Linus' Law, often expressed as "Given enough eyeballs, all bugs are shallow." Our findings are consistent with a narrow interpretation of Linus' Law, namely, a greater number of contributors to an article makes an article more neutral. No evidence supports a broad interpretation of Linus' Law. Moreover, several empirical facts suggest the law does not shape many articles. The majority of articles receive little attention, and most articles change only mildly from their initial slant. Our study provides the first empirical evidence on the limit of Linus' Law. While many organizations believe that they could improve their knowledge production by leveraging communities, we show that in the case of Wikipedia, there are aspects, such as NPOV, that the community does not always achieve successfully.

    Keywords: Prejudice and Bias; Online Technology; Balance and Stability; Operations; Knowledge Management; Knowledge Dissemination;

    Citation:

    Greenstein, Shane, and Feng Zhu. "Open Content, Linus' Law, and Neutral Point of View." Information Systems Research 27, no. 3 (September 2016): 618–635.  View Details
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  3. Article | MIS Quarterly

    Do Experts or Crowd-Based Models Produce More Bias? Evidence from Encyclopædia Britannica and Wikipedia

    Shane Greenstein and Feng Zhu

    Organizations today can use both crowds and experts to produce knowledge. While prior work compares the accuracy of crowd-produced and expert-produced knowledge, we compare bias in these two models in the context of contested knowledge, which involves subjective, unverifiable, or controversial information. Using data from Encyclopædia Britannica, authored by experts, and Wikipedia, an encyclopedia produced by an online community, we compare the slant and bias of pairs of articles on identical topics of U.S. politics. Our slant measure is less (more) than zero when an article leans towards Democratic (Republican) viewpoints, while bias is the absolute value of the slant. We find that Wikipedia articles are more slanted towards Democratic views than are Britannica articles, as well as more biased. The difference in bias between a pair of articles decreases with more revisions. The bias on a per word basis hardly differs between the sources because Wikipedia articles tend to be longer than Britannica articles. These results highlight the pros and cons of each knowledge production model, help identify the scope of the empirical generalization of prior studies comparing the information quality of the two production models, and offer implications for organizations managing crowd-based knowledge production.

    Keywords: online community; Collective Intelligence; wisdom of crowds; bias; Wikipedia; Britannica; knowledge production; Knowledge Sharing; Knowledge Dissemination; Prejudice and Bias;

    Citation:

    Greenstein, Shane, and Feng Zhu. "Do Experts or Crowd-Based Models Produce More Bias? Evidence from Encyclopædia Britannica and Wikipedia." MIS Quarterly 42, no. 3 (September 2018): 945–959.  View Details
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  5. Article | Strategic Management Journal

    The Reference Wars: Encyclopædia Britannica's Decline and Encarta's Emergence

    Shane Greenstein

    The experience of Encyclopædia Britannica provides the canonical example of the decline of an established firm at the outset of the digital age. Competition from Microsoft’s Encarta in 1993 led to sharp declines in the sales of books, which led to the distressed sale of the firm in 1996. This essay offers new source material about the actions at both Encarta and Britannica, and it offers a novel interpretation of events. Britannica’s management did not misperceive the opportunities and threats, and Britannica did not lack technical prowess. This narrative stresses that Britannica’s management faced organizational diseconomies of scope between supporting lines of business in the old and new markets, which generated internal conflicts. These conflicts hindered the commercialization of new technology and hastened its decline.

    Keywords: digital; Britannica; diseconomies; encyclopedias; Software; Books; Competition; Publishing Industry;

    Citation:

    Greenstein, Shane. "The Reference Wars: Encyclopædia Britannica's Decline and Encarta's Emergence." Strategic Management Journal 38, no. 5 (May 2017): 995–1017.  View Details
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  6. Chapter | The New Oxford Handbook of Economic Geography | 2018

    How Geography Shapes—and Is Shaped by—the Internet

    Shane Greenstein, Avi Goldfarb and Chris Forman

    Book Abstract: The first 15 years of the 21st century have thrown into sharp relief the challenges of growth, equity, stability, and sustainability facing the world economy. In addition, they have exposed the inadequacies of mainstream economics in providing answers to these challenges. This volume gathers over 50 leading scholars from around the world to offer a forward-looking perspective of economic geography to understanding the various building blocks, relationships, and trajectories in the world economy. The perspective is at the same time grounded in theory and in the experiences of particular places. Reviewing state-of-the-art of economic geography, setting agendas, and with illustrations and empirical evidence from all over the world, the book should be an essential reference for students and researchers as well as strategists and policy makers.

    Keywords: Economics; Geographic Location; Internet;

    Citation:

    Greenstein, Shane, Avi Goldfarb, and Chris Forman. "How Geography Shapes—and Is Shaped by—the Internet." In The New Oxford Handbook of Economic Geography, edited by Gordon Clark, Maryann Feldman, Meric Gertler, and Dariusz Wojcik, 269–285. Oxford: Oxford University Press, 2018.  View Details
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  7. Article | Journal of Economics & Management Strategy

    Measuring Consumer Preferences for Video Content Provision via Cord-Cutting Behavior

    Jeffrey Prince and Shane Greenstein

    The television industry is undergoing a generational shift in structure; however, many demand-side determinants are still not well understood. We model how consumers choose video content provision among over-the-air (OTA), paid subscription to cable or satellite, and online streaming (also known as over-the-top or OTT). We apply our model to a U.S. dataset encompassing both the digital switchover for OTA and the emergence of OTT, along with a recession, and use it to analyze cord-cutting behavior (i.e., dropping of cable/satellite subscriptions). We find high levels of cord cutting during this time and evidence that it became relatively more prevalent among low-income and younger households—suggesting this group responded to changes in OTA and streaming options. We find little evidence of households weighing relative content offerings/quality when choosing their means of video provision during the timespan of our data. This last finding has important ramifications for strategic interaction between content providers.

    Keywords: Technology; Service Delivery; Consumer Behavior; Television Entertainment; Service Industry; Media and Broadcasting Industry;

    Citation:

    Prince, Jeffrey, and Shane Greenstein. "Measuring Consumer Preferences for Video Content Provision via Cord-Cutting Behavior." Journal of Economics & Management Strategy 26, no. 2 (Summer 2017): 293–317.  View Details
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  8. Book | 2015

    Economic Analysis of the Digital Economy

    Avi Goldfarb, Shane Greenstein and Catherine Tucker

    As the cost of storing, sharing, and analyzing data has decreased, economic activity has become increasingly digital. But while the effects of digital technology and improved digital communication have been explored in a variety of contexts, the impact on economic activity—from consumer and entrepreneurial behavior to the ways in which governments determine policy—is less well understood. Economic Analysis of the Digital Economy explores the economic impact of digitization, with each chapter identifying a promising new area of research. The Internet is one of the key drivers of growth in digital communication, and the first set of chapters discusses basic supply-and-demand factors related to access. Later chapters discuss new opportunities and challenges created by digital technology and describe some of the most pressing policy issues. As digital technologies continue to gain in momentum and importance, it has become clear that digitization has features that do not fit well into traditional economic models. This suggests a need for a better understanding of the impact of digital technology on economic activity, and Economic Analysis of the Digital Economy brings together leading scholars to explore this emerging area of research.

    Keywords: Technology; Economics;

    Citation:

    Goldfarb, Avi, Shane Greenstein and Catherine Tucker, eds. Economic Analysis of the Digital Economy. University of Chicago Press, 2015.  View Details
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  9. Article | Research Policy

    Digital Dark Matter and the Economic Contribution of Apache

    Shane Greenstein and Frank Nagle

    Researchers have long hypothesized that research outputs from government, university, and private company R&D contribute to economic growth, but these contributions may be difficult to measure when they take a non-pecuniary form. The growth of networking devices and the Internet in the 1990s and 2000s magnified these challenges, as illustrated by the deployment of the descendent of the NCSA HTTPd server, otherwise known as Apache. This study asks whether this experience could produce measurement issues in standard productivity analysis, specifically, omission and attribution issues, and, if so, whether the magnitude is large enough to matter. The study develops and analyzes a novel data set consisting of a 1% sample of all outward-facing web servers used in the United States. We find that use of Apache potentially accounts for a mismeasurement of somewhere between $2 billion and $12 billion, which equates to between 1.3% and 8.7% of the stock of prepackaged software in private fixed investment in the United States and a very high rate of return to the original federal investment in the Internet. We argue that these findings point to a large potential undercounting of the rate of return from IT spillovers from the invention of the Internet. The findings also suggest a large potential undercounting of "digital dark matter" in general.

    Keywords: open source; Apache; Economic measurement; Digital economics; Measurement and Metrics; Open Source Distribution; Internet; Information Technology; Software; Economic Growth; Research and Development; Web Services Industry; Information Technology Industry; United States;

    Citation:

    Greenstein, Shane, and Frank Nagle. "Digital Dark Matter and the Economic Contribution of Apache." Research Policy 43, no. 4 (May 2014): 623–631. (Lead Article.)  View Details
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  10. Article | Journal of Economics & Management Strategy

    Does Service Bundling Reduce Churn?

    Jeff Prince and Shane Greenstein

    We examine whether bundling in telecommunications services reduces churn using a series of large, independent cross sections of household decisions. To identify the effect of bundling, we construct a pseudo-panel dataset and utilize a linear, dynamic panel-data model, supplemented by nearest-neighbor matching. We find bundling does reduce churn for all three "triple-play" services. The effect is only "visible" during times of turbulent demand. We also find evidence that broadband was substituting for pay television in 2009. This analysis highlights that bundling helps with customer retention in service industries, and may play an important role in preserving contracting markets.

    Keywords: Communication Technology; Customer Satisfaction; Product Marketing; Telecommunications Industry;

    Citation:

    Prince, Jeff, and Shane Greenstein. "Does Service Bundling Reduce Churn?" Journal of Economics & Management Strategy 23, no. 4 (Winter 2014): 839–875.  View Details
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  14. Article | Strategic Organization

    Digitization, Innovation, and Copyright: What Is the Agenda?

    Shane Greenstein, Josh Lerner and Scott Stern

    This essay discusses the need for research on the consequences of digitization, as well as the impact of alternative policies governing the creation and use of digital information. This agenda focuses on the development of research to investigate the economics of digitization, to analyze the governance of intellectual property in this sector, particularly through copyright, and to pioneer approaches to analyzing measurement of digitization. This agenda overlaps with many related open questions in organizational and strategy research.

    Keywords: Technology; Research; Copyright; Information Management; Innovation and Invention;

    Citation:

    Greenstein, Shane, Josh Lerner, and Scott Stern. "Digitization, Innovation, and Copyright: What Is the Agenda?" Strategic Organization 11, no. 1 (February 2013): 110–121.  View Details
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Technological Competition in Computing

  1. Article | Industrial and Corporate Change

    Technological Leadership (de)Concentration: Causes in Information and Communication Technology Equipment

    Yasin Ozcan and Shane Greenstein

    Using patent data from 1976 to 2010 as indicators of inventive activity, we determine the concentration level of where inventive ideas originate and then examine how and why those concentrations change over time. The analysis finds pervasive deconcentration in every area related to the Information and Communication Technology equipment market. We find that booms and busts play an important role in deconcentration trends. In comparison, new entry explains surprisingly little, and merger and acquisition activity does not revert the trend.

    Keywords: deconcentration; Technological Innovation; Innovation Leadership; Patents; Market Entry and Exit; Telecommunications Industry;

    Citation:

    Ozcan, Yasin, and Shane Greenstein. "Technological Leadership (de)Concentration: Causes in Information and Communication Technology Equipment." Industrial and Corporate Change 29, no. 2 (April 2020): 241–263.  View Details
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  2. Article | American Economic Review: Papers and Proceedings

    Invention and Agglomeration in the Bay Area: Not Just ICT

    Chris Forman, Avi Goldfarb and Shane Greenstein

    We document that the Bay Area rose from 4% of all successful US patent applications in 1976 to 16% in 2008. This is partly driven by the increase in the prevalence of information and communication technology; however, even for patents unrelated to information and communication technology, we see a disproportionate increase in the share of US patents from the Bay Area. We interpret this growth as a trend to coagglomeration in invention across technologies, and we explore different dimensions of this trend.

    Keywords: agglomeration; Technology; Patents; San Francisco;

    Citation:

    Forman, Chris, Avi Goldfarb, and Shane Greenstein. "Invention and Agglomeration in the Bay Area: Not Just ICT." American Economic Review: Papers and Proceedings 106, no. 5 (May 2016): 146–151.  View Details
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  3. Article | American Economic Review: Papers and Proceedings

    Mobile Computing: The Next Platform Rivalry

    Timothy Bresnahan and Shane Greenstein

    Competition to become one of several dominant mobile platforms is intense. Platforms compete for developers, who create applications which make the platform valuable for users. Why doesn't one form of platform governance emerge as superior? This essay will stress the reasons for differentiation and proposes a new argument linked to a platform's "hierarchy." Hierarchical governance features can help at one moment but then get in the way at a later time. These arguments are illustrated by different approaches to platform governance taken by the major mobile platform sponsors of recent years.

    Citation:

    Bresnahan, Timothy, and Shane Greenstein. "Mobile Computing: The Next Platform Rivalry." American Economic Review: Papers and Proceedings 104, no. 5 (May 2014): 475–480.  View Details
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  4. Chapter | The Rate and Direction of Inventive Activity Revisited | 2012

    Schumpeterian Competition and Diseconomies of Scope: Illustrations from the Histories of Microsoft and IBM

    Timothy F. Bresnahan, Shane Greenstein and Rebecca M. Henderson

    We address a longstanding question about the causes of creative destruction. Dominant incumbent firms, long successful in an existing technology, are often much less successful in new technological eras. This is puzzling, since a cursory analysis would suggest that incumbent firms have the potential to take advantage of economies of scope across new and old lines of business and, if economies of scope are unavailable, to simply reproduce entrant behavior by creating a "firm within a firm." There are two broad streams of explanation for incumbent failure in these circumstances. One posits that incumbents fear cannibalization in the marketplace and so under-invest in the new technology. The second suggests that incumbent firms develop organizational capabilities and cognitive frames that make them slow to "see" new opportunities and that make it difficult to respond effectively once the new opportunity is identified. In this paper we draw on two of the most important historical episodes in the history of the computing industry, the introduction of the PC and of the browser, to develop a third hypothesis. Both IBM and Microsoft, having been extremely successful in an old technology, came to have grave difficulties competing in the new, despite some dramatic early success. We suggest that these difficulties do not arise from cannibalization concerns or from inherited cognitive frames. Instead they reflect diseconomies of scope rooted in assets that are necessarily shared across both businesses. We show that both Microsoft and IBM were initially very successful in creating freestanding business units that could compete with entrants on their own terms, but that as the new businesses grew, the need to share key firm-level assets imposed significant costs on both businesses and created severe organizational conflict. In IBM and Microsoft's case this conflict eventually led to control over the new business being given to the old and that in both cases effectively crippled the new business.

    Keywords: Technological Innovation; Opportunities; Competition; Information Technology; Innovation and Management; Organizations; Relationships; Information Technology Industry;

    Citation:

    Bresnahan, Timothy F., Shane Greenstein, and Rebecca M. Henderson. "Schumpeterian Competition and Diseconomies of Scope: Illustrations from the Histories of Microsoft and IBM." In The Rate and Direction of Inventive Activity Revisited, edited by Josh Lerner and Scott Stern. University of Chicago Press, 2012.  View Details
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The Economics of Enterprise IT

  1. Chapter | The Changing Frontier: Rethinking Science and Innovation Policy | 2015

    Information Technology and the Distribution of Inventive Activity

    Chris Forman, Avi Goldfarb and Shane Greenstein

    We examine the relationship between the diffusion of advanced Internet technology and the geographic concentration of invention, as measured by patents. First, we show that patenting became more concentrated from the early 1990s to the early 2000s and, similarly, that counties that were leaders in patenting in the early 1990s produced relatively more patents by the early 2000s. Second, we compare the extent of invention in counties that were leaders in Internet adoption to those that were not. We see little difference in the growth rate of patenting between leaders and laggards in Internet adoption, on average. However, we find that the rate of patent growth was faster among counties who were not leaders in patenting in the early 1990s but were leaders in Internet adoption by 2000, suggesting that the Internet helped stem the trend towards more geographic concentration. We show that these results are largely driven by patents filed by distant collaborators rather than non-collaborative patents or patents by non-distant collaborators, suggesting low cost long-distance digital communication as a potential mechanism.

    Keywords: Patents; Geographic Location; Internet; Innovation and Invention;

    Citation:

    Forman, Chris, Avi Goldfarb, and Shane Greenstein. "Information Technology and the Distribution of Inventive Activity." In The Changing Frontier: Rethinking Science and Innovation Policy, edited by Adam Jaffe and Benjamin Jones, 169–196. University of Chicago Press, 2015.  View Details
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  4. Chapter | The Palgrave Encyclopedia of Strategic Management | 2018

    Technology Adoption

    Chris Forman, Avi Goldfarb and Shane Greenstein

    Using examples from information technology adoption, we emphasize the role of costs, benefits, communications channels and dynamic considerations in the decision to adopt new technology. We discuss differences between adoption by consumers and adoption by firms. We emphasize the adoption of business process innovations, which alter organizational practices and often involve the post-adoption invention of complementary business processes and adaptations. Within the context of business adoption, we discuss the inherent challenges in identifying the decision maker and the role of competition in influencing the benefits to adoption.

    Keywords: Technology Adoption;

    Citation:

    Forman, Chris, Avi Goldfarb, and Shane Greenstein. "Technology Adoption." In The Palgrave Encyclopedia of Strategic Management. Continuously updated edition, edited by Mie Augier and David J. Teece. Palgrave Macmillan, 2017. Electronic.  View Details
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  9. Chapter | Organizing the New Industrial Economy | 2003

    Which Industries Use the Internet?

    Chris Forman, Avi Goldfarb and Shane Greenstein

    Citation:

    Forman, Chris, Avi Goldfarb, and Shane Greenstein. "Which Industries Use the Internet?" In Organizing the New Industrial Economy. Vol. 12, edited by Michael R Baye, 47–72. Advances in Applied Microeconomics. Emerald Group Publishing, 2003.  View Details
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  10. Chapter | Rethinking Rights and Regulations | 2003

    The Geographic Dispersion of Commercial Internet Use

    Chris Forman, Avi Goldfarb and Shane Greenstein

    Citation:

    Forman, Chris, Avi Goldfarb, and Shane Greenstein. "The Geographic Dispersion of Commercial Internet Use." In Rethinking Rights and Regulations: Institutional Responses to New Communication Technologies, edited by Lorrie Faith Cranor and Steven S. Wildman, 113–145. MIT Press, 2003.  View Details
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Working Papers

  1. Working Paper | HBS Working Paper Series | 2020

    Digital Labor Market Inequality and the Decline of IT Exceptionalism

    Ruiqing Cao and Shane Greenstein

    Several decades of expansion in digital communications, web commerce, and online distribution have altered the U.S. labor market for IT workers. We characterize the shifts in regional IT labor markets from 2000 to 2018, and find that IT wage growth did not follow an exceptional pattern compared to broader STEM labor market trends. Digital wage inequality increased, almost entirely due to rising local premiums in a few urban metropolises, where wage spreads became narrower than elsewhere. The supply of college-educated workers accounted for a substantial share of the total wage difference between IT labor markets in top locations and other cities. Agglomeration and IT innovation explained a notably larger fraction of the top-location wage premium in more recent years.

    Citation:

    Cao, Ruiqing, and Shane Greenstein. "Digital Labor Market Inequality and the Decline of IT Exceptionalism." Harvard Business School Working Paper, No. 21-019, August 2020. (NBER Working Paper Series, No. 21-015, August 2020.)  View Details
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  2. Working Paper | HBS Working Paper Series | 2020

    Open Source Software and Global Entrepreneurship

    Nataliya Langburd Wright, Frank Nagle and Shane Greenstein

    Does more activity in open source lead to more entrepreneurial activity and, if so, how much, and in what direction? This study measures how participation on the GitHub open source platform affects the founding of new ventures globally. We estimate these effects using cross-country variation in new venture foundings and open source participation. The study finds that a 1 percent increase in GitHub commits (code contributions) from people residing in a given country generates a 0.1-0.5 percent increase in the number of technology ventures founded within that country, a 0.6 percent increase in the number of new financing deals, a 0.97 percent increase in financing value, a 0.3 percent increase in the number of technology acquisitions, and a 0.1-0.5 percent increase in the number of global and mission-oriented ventures. The analysis develops an approach to identification based on various instrumental variables and shows that these associations can support causal inferences. We conclude that OSS contributes to different rates of entrepreneurship around the world and therefore can act as a policy lever to improve economic development and can also indicate promising investment opportunities.

    Keywords: open source software; GitHub; Software; Entrepreneurship; Global Range; Development Economics;

    Citation:

    Wright, Nataliya Langburd, Frank Nagle, and Shane Greenstein. "Open Source Software and Global Entrepreneurship." Harvard Business School Working Paper, No. 20-139, June 2020. (Revised July 2020.)  View Details
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  3. Working Paper | 2019

    The Impact of the General Data Protection Regulation on Internet Interconnection

    Ran Zhuo, Bradley Huffaker, KC Claffy and Shane Greenstein

    The Internet comprises thousands of independently operated networks, where bilaterally negotiated interconnection agreements determine the flow of data between networks. The European Union’s General Data Protection Regulation (GDPR) imposes strict restrictions on processing and sharing of personal data of EU residents. Both contemporary news reports and simple bilateral bargaining theory predict reduction in data usage at the application layer and would negatively impact incentives for negotiating interconnection agreements at the internet layer due to reduced bargaining power of European networks and increased bargaining frictions. Considerable empirical evidence at the application layer confirms this prediction. Using a large sample of interconnection agreements between networks around the world in 2015–2019, we empirically investigate the impact of the GDPR on interconnection behavior of network operators in the European Economic Area (EEA) compared to network operators in non-EEA OECD countries. All evidence estimates precisely zero effects across multiple measures: the number of observed agreements per network, the inferred agreement types, and the number of observed IP-address-level interconnection points per agreement. We also find economically small effects of the GDPR on the entry and the observed number of network customers. We conclude that the short-run costs for GDPR are concentrated at the application layer.

    Keywords: personal data; Privacy Regulation; GDPR; interconnection agreements; Internet; Governing Rules, Regulations, and Reforms; European Union;

    Citation:

    Zhuo, Ran, Bradley Huffaker, KC Claffy, and Shane Greenstein. "The Impact of the General Data Protection Regulation on Internet Interconnection." NBER Working Paper Series, No. 26481, November 2019.  View Details
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  4. Working Paper | 2018

    The State of Open Source Server Software

    Shane Greenstein and Klaus Ackermann

    The study assembles new data to construct a census of worldwide web server use across the globe. We document a large concentration of investment in the United States, and a wide dispersion across scores of countries. We find tens of billions of dollars of unmeasured value in the open source servers. The statistical models show the quality of the country’s network and the country’s technical sophistication are associated with more web servers, and the innovative environment also plays a role. We find less of a role for economic development, property rights and the rule of law. The findings stress that policies for local supply of content depend on policies encouraging advanced networking and a technically sophisticated populace. While the findings highlight the danger for misattribution in growth accounting, the statistical model points towards the potential to proxy for unmeasured servers with statistical methods.

    Keywords: internet; open source; Internet; Policy; Open Source Distribution; Web; Global Range;

    Citation:

    Greenstein, Shane, and Klaus Ackermann. "The State of Open Source Server Software." Working Paper, September 2018.  View Details
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  5. Working Paper | 2018

    Evidence of Decreasing Internet Entropy: The Lack of Redundancy in DNS Resolution by Major Websites and Services

    Samantha Bates, John Bowers, Shane Greenstein, Jordi Weinstock, Jonathan Zittrain and Yunhan Xu

    This paper analyzes the extent to which the internet’s global domain name resolution (DNS) system has preserved its distributed resilience given the rise of cloud-based hosting and infrastructure. We explore trends in the concentration of the DNS space since at least 2011. In addition, we examine changes in domains’ tendency to “diversify” their pool of nameservers—how frequently domains employ DNS management services from multiple providers rather than just one provider—a comparatively costless and therefore puzzlingly rare decision that could supply redundancy and resilience in the event of an attack or service outage affecting one provider.

    Keywords: Internet; Infrastructure; Performance Effectiveness;

    Citation:

    Bates, Samantha, John Bowers, Shane Greenstein, Jordi Weinstock, Jonathan Zittrain, and Yunhan Xu. "Evidence of Decreasing Internet Entropy: The Lack of Redundancy in DNS Resolution by Major Websites and Services." NBER Working Paper Series, No. 24317, February 2018.  View Details
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  6. Working Paper | 2014

    Information Technology and the Distribution of Inventive Activity

    Chris Forman, Avi Goldfarb and Shane Greenstein

    We examine the relationship between the diffusion of advanced internet technology and the geographic concentration of invention, as measured by patents. First, we show that patenting became more concentrated from the early 1990s to the early 2000s and, similarly, that counties that were leaders in patenting in the early 1990s produced relatively more patents by the early 2000s. Second, we compare the extent of invention in counties that were leaders in Internet adoption to those that were not. We see little difference in the growth rate of patenting between leaders and laggards in Internet adoption, on average. However, we find that the rate of patent growth was faster among counties that were not leaders in patenting in the early 1990s but were leaders in Internet adoption by 2000, suggesting that the Internet helped stem the trend towards more geographic concentration. We show that these results are largely driven by patents filed by distant collaborators rather than non-collaborative patents or patents by non-distant collaborators, suggesting low cost long-distance digital communication as a potential mechanism.

    Keywords: Patents; Internet; Technology Adoption; Innovation and Invention;

    Citation:

    Forman, Chris, Avi Goldfarb, and Shane Greenstein. "Information Technology and the Distribution of Inventive Activity." NBER Working Paper Series, No. 20036, April 2014.  View Details
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Cases and Teaching Materials

  2. Supplement | HBS Case Collection | December 2019

    Korea Telecom: Building a GiGAtopia (B)

    Shane Greenstein, Feng Zhu and Susie L. Ma

    Keywords: Mobile Technology; Infrastructure; Growth and Development Strategy; Competitive Strategy; Decision Choices and Conditions; Technology Industry; Telecommunications Industry; Korean Peninsula;

    Citation:

    Greenstein, Shane, Feng Zhu, and Susie L. Ma. "Korea Telecom: Building a GiGAtopia (B)." Harvard Business School Supplement 620-060, December 2019.  View Details
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  3. Case | HBS Case Collection | November 2019

    DeepMap: Charting the Road Ahead for Autonomous Vehicles

    Shane Greenstein and Nicole Tempest Keller

    Founded in 2016, DeepMap developed high definition (HD) mapping software and localization services for Level 4+ autonomous vehicles. Traditional navigational maps were accurate to a few meters, which was sufficient for drivers but not for machine-driven vehicles that required centimeter level accuracy. Autonomous vehicles required a new form of map that was highly precise, produced a 3D representation of the surrounding area, enabled vehicles to locate themselves within the map, provided information for how to navigate safely using the correct rules of the road, and was updated continuously as road conditions changed. DeepMap was not selling a static mapping database but was rather licensing its software under a software-as-a-service model. As a startup with limited resources navigating a nascent market, DeepMap faced uncertainty across several dimensions: the timing of overall AV market adoption, which countries would adopt fastest, which AV segments would move most rapidly, which sensor technologies would become standard, and what impact regulation would have. They also faced the challenge of serving customers on a global scale. As DeepMap looked ahead, it had to decide how and where to focus and allocate its funding in order to achieve its short- and long-term objectives.

    Keywords: mapping software; autonomous vehicles; Business Startups; Software; Technological Innovation; Technology Adoption; Service Delivery; Global Range; Resource Allocation; Strategic Planning; Technology Industry; Auto Industry;

    Citation:

    Greenstein, Shane, and Nicole Tempest Keller. "DeepMap: Charting the Road Ahead for Autonomous Vehicles." Harvard Business School Case 620-047, November 2019.  View Details
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  4. Case | HBS Case Collection | October 2019

    Feeling Machines: Emotion AI at Affectiva

    Shane Greenstein and John Masko

    In 2016, Affectiva—a Boston-based emotion AI software company with a long track record of building emotion-sensing software for market research—had attempted to expand into new verticals by releasing a mobile software development kit (SDK) that downloaders could adapt for their own use cases. The experience taught Affectiva that the company itself would have to bear most of the financial risk for adapting its technologies but also demonstrated that the automotive industry was very interested in using Affectiva’s technology to monitor the emotions and cognitive states of drivers and passengers. In 2018, Affectiva executed a “90% pivot” to serve the automotive industry’s increasing demand for “emotion AI”. However, with automotive revenues not expected for several years and very expensive data collection requirements to enter the industry, Affectiva faced a challenging set of trade-offs between its market research business, its SDK, and its automotive aspirations.

    Keywords: artificial intelligence; Market research; Business Model; Finance; Revenue; Decision Making; Risk and Uncertainty; Market Entry and Exit; Software; Information Technology Industry; Auto Industry; United States;

    Citation:

    Greenstein, Shane, and John Masko. "Feeling Machines: Emotion AI at Affectiva." Harvard Business School Case 620-058, October 2019.  View Details
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  5. Case | HBS Case Collection | August 2019

    Twiggle: E-commerce with Semantic Search

    Shane Greenstein and Danielle Golan

    Four years after being founded, in 2014, by former Google executives Amir Konigsberg (CEO) and Adi Avidor (CTO), Twiggle had developed a search enhancement that plugged into an online merchant’s existing framework. The company utilized advanced structuring and linguistic tools to build search technology that understood shopper intent and matched it with the right products. Konigsberg and Avidor believed e-tailers were losing enormous revenue due to poor search results. The team built a set of proprietary tools that created a human-like understanding of customer queries in the e-commerce search experience, using natural language processing that translated text into meaning. The team also constructed a semantic model of the e-commerce world for three product domains: fashion, home and electronics. The resulting “ontology” was a set of concepts and categories in a subject area that showed their properties and the relations between them. Twiggle’s tools could also unlock significant online sales revenue by increasing click-through and add-to-cart rates, ultimately improving sales conversions. So far, the company had secured deals with more than half a dozen large e-commerce retailers, and could improve search results in three product categories: fashion, home, and electronics.
    The company initially targeted large direct-to-consumer e-commerce players. Yet the cofounders encountered challenges pursuing this type of customer. The customer acquisition process included lengthy, intensive face-to-face sales cycles, expensive and technologically complex proof-of-concept testing, and requests for customization. Konigsberg and Avidor wondered if they should expand their customer focus to target a wider set of smaller e-tailers that still had significant volumes of online search queries, but whose search quality tended to be less robust and might be easier to improve. They also contemplated a variety of growth opportunities.

    Keywords: e-commerce; search technology; customer acquisition; Online Technology; Technological Innovation; Commercialization; Growth and Development Strategy; Technology Industry; Israel;

    Citation:

    Greenstein, Shane, and Danielle Golan. "Twiggle: E-commerce with Semantic Search." Harvard Business School Case 620-025, August 2019.  View Details
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  6. Teaching Note | HBS Case Collection | June 2019

    Zebra Medical Vision

    Shane Greenstein and Sarah Gulick

    Teaching note is meant to accompany Zebra Medical Vision case, which offers a look at a company’s decisions as a small startup competing with other startups and major technology companies. It also demonstrates the challenges faced by a machine learning company working on brand-new technology, including difficulties finding training data, hiring competition, and negotiating FDA approvals and other government regulations. Teaching Note for HBS No. 619-014.

    Keywords: Business Startups; Science-Based Business; Software; Patents; Cross-Cultural and Cross-Border Issues; Health Care and Treatment; Health Industry; Medical Devices and Supplies Industry; Technology Industry; Israel;

    Citation:

    Greenstein, Shane, and Sarah Gulick. "Zebra Medical Vision." Harvard Business School Teaching Note 619-053, June 2019.  View Details
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  7. Case | HBS Case Collection | September 2018 (Revised December 2019)

    Zebra Medical Vision

    Shane Greenstein and Sarah Gulick

    An Israeli startup founded in 2014, Zebra Medical Vision developed algorithms that produced diagnoses from X-rays, mammograms, and CT-scans. The algorithms used deep learning and digitized radiology scans to create software that could assist doctors in making diagnoses. By July 2018, Zebra had developed seven algorithms to analyze scans for emphysema, liver density, compression fractures, bone density, brain bleeds, breast cancer, and a calcium score used to detect calcified plaque in coronary arteries. For each scan analyzed, Zebra charged hospitals $1. By 2018 Zebra found itself in a race with its competitors to perfect these algorithms, create software tools, distribute the tools to physician partners, and create a market. Zebra already had several partners in the U.S. and Europe who gave feedback on its development. Management had to answer the following questions: What should they do next at Zebra? Should they work on the accuracy of the already developed algorithms or continue to develop many new tools? If they chose to develop new products, which applications should they address? And how should they go to market?

    Keywords: radiology; Machine learning; X-ray; CT scan; medical technology; probability; FDA 510(k); diagnosis; Business Startups; Health Care and Treatment; Technology; Software; Competitive Strategy; Product Development; Commercialization; Decision Choices and Conditions; Health Industry; Medical Devices and Supplies Industry; Technology Industry; Israel;

    Citation:

    Greenstein, Shane, and Sarah Gulick. "Zebra Medical Vision." Harvard Business School Case 619-014, September 2018. (Revised December 2019.)  View Details
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  8. Technical Note | HBS Case Collection | March 2018

    Internet Data Capping Note (B)

    Shane Greenstein and Christine Snively

    The B note brings the reader up through early 2017 and addresses an informal review carried out by the Wireless Telecommunications Bureau (WTB) on sponsored data and zero-rating data plans in the mobile broadband market.

    Keywords: telecommunications; Technology; Internet;

    Citation:

    Greenstein, Shane, and Christine Snively. "Internet Data Capping Note (B)." Harvard Business School Technical Note 618-061, March 2018.  View Details
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  9. Case | HBS Case Collection | January 2018

    Viacom: Democratization of Data Science

    Shane Greenstein and Christine Snively

    In two short years, Viacom’s Data Science & Advanced Analytics team built a web platform called Science Central that allowed employees from Viacom’s 20+ cable networks to access television audience insights through three data science apps. In the past, employees would have approached the team to carry out these requests. Vice President of Data and Audience Development Fabio Luzzi, who oversaw the 10-person team, believed that making data science instantly available in accessible formats would allow teams to make better-informed decisions. By June 2017, the platform had 600 regular users, but Luzzi wanted to expand its reach. He considered whether the team should focus on strengthening the platform or devote more resources to custom analytics requests that would allow the team to explore new problems and develop new insights.

    Keywords: data science; big data; Technology Platform; Data and Data Sets; Expansion; Strategic Planning;

    Citation:

    Greenstein, Shane, and Christine Snively. "Viacom: Democratization of Data Science." Harvard Business School Case 618-016, January 2018.  View Details
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  10. Case | HBS Case Collection | September 2017 (Revised March 2018)

    Great Lakes Banking Group: Data Management

    Shane Greenstein and Christine Snively

    In May 2016, Michael Rechtin, an expert in international data center law, advised global financial services firm Great Lakes Banking Group (GLBG) on its plans to upgrade its data centers. The bank’s data processing and storage systems were in need of an update, and since GLBG last made heavy IT investments in the late 1990s, the technology had changed considerably. GLBG sought Rechtin’s advice on whether or not it should build a new data center, pursue a wholesale colocation solution, rent space from a retail colocation provider, or store more data in the cloud.

    Keywords: Hardware; Infrastructure; Operations; Information Management;

    Citation:

    Greenstein, Shane, and Christine Snively. "Great Lakes Banking Group: Data Management." Harvard Business School Case 618-021, September 2017. (Revised March 2018.)  View Details
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  11. Case | HBS Case Collection | April 2017 (Revised January 2020)

    Korea Telecom: Building a GiGAtopia (A)

    Shane Greenstein, Feng Zhu and Kerry Herman

    Korea Telecom (KT) has committed $4 billion in investments and R&D to build a GiGAtopia, essentially ushering in the next generation of mobile (5G) and wired infrastructure. CEO Dr. Chang-Gyu Hwang, and his team are considering which areas to prioritize in terms of new products and services in development. The top five sectors identified by KT’s team include the Internet of Things (including connected cars and smart city/homes), media, health, energy, and security and surveillance, which might provide some quick wins both in terms of revenues and market lead. Should KT develop solutions that could be exported to other countries? Should KT go all in across all five sectors, or select one or two to prioritize?

    Keywords: Mobile Technology; Technological Innovation; Infrastructure; Growth and Development Strategy; Competitive Strategy; Decision Choices and Conditions; Telecommunications Industry;

    Citation:

    Greenstein, Shane, Feng Zhu, and Kerry Herman. "Korea Telecom: Building a GiGAtopia (A)." Harvard Business School Case 617-014, April 2017. (Revised January 2020.)  View Details
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  13. Technical Note | HBS Case Collection | September 2016 (Revised October 2016)

    Internet Data Capping Note

    Shane Greenstein, Lisa Cox and Christine Snively

    In April 2016, U.S. federal regulators approved Charter Communications’ acquisition of Time Warner Cable (TWC). The Department of Justice (DoJ) and Federal Communications Commission (FCC), however, stipulated that the new company could not apply data caps or introduce usage-based pricing to its Internet customers for seven years. Over the course of 2015, the number of consumer complaints filed with the FCC had grown to nearly 8,000. The focus of this note is to highlight some of the controversy surrounding data capping, introduce competing claims and outline the durable and inescapable tensions between different outlooks on pricing Internet service.

    Keywords: Internet service provider; data caps; compression; Technology; Internet; United States;

    Citation:

    Greenstein, Shane, Lisa Cox, and Christine Snively. "Internet Data Capping Note." Harvard Business School Technical Note 617-003, September 2016. (Revised October 2016.)  View Details
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  14. Technical Note | HBS Case Collection | July 2016

    Net Neutrality: A Managerial Perspective

    Shane Greenstein and Christine Snively

    The net neutrality debate had implications for Internet service providers, content providers, and end users. This note aims to inform the reader of the various sides of the debate where open issues remain, as well as what aspects an entrepreneur, investor, or content provider—either an existing player or a new entrant—should know. From a management perspective, net neutrality rules could have major consequences on the business models of content providers, ISPs, and other businesses that depend on the transfer of data across the Internet.

    Keywords: net neutrality; Technology; Internet; Hardware; Information Technology; Technology Industry;

    Citation:

    Greenstein, Shane, and Christine Snively. "Net Neutrality: A Managerial Perspective." Harvard Business School Technical Note 617-006, July 2016.  View Details
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  15. Case | HBS Case Collection | October 2015

    Facebook: The First Ten Years

    Shane Greenstein, Marco Iansiti and Christine Snively

    Facebook celebrated its ten year anniversary in February 2014. Over the past decade it has grown into the largest social network in the world with one billion users. After filing an IPO in 2012 at a $104 billion valuation (the third largest IPO in U.S. history), the stock price steadily declined, but recovered after the company implemented an effective advertising strategy. Facebook worked to maintain its "hacker ethos" and remain nimble as it matured. The company was worth close to $200 billion. Could this kind of value sustain itself for years to come?

    Keywords: social networks; technology; Facebook; Entrepreneurship; Profit; Open Source Distribution; Social and Collaborative Networks; Competition; Competitive Strategy; Online Technology; Technology Platform; Information Technology Industry;

    Citation:

    Greenstein, Shane, Marco Iansiti, and Christine Snively. "Facebook: The First Ten Years." Harvard Business School Case 616-012, October 2015. (More Info.)  View Details
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  16. Case | HBS Case Collection | November 2015 (Revised April 2017)

    Streaming Over Broadband: Why Doesn't My Netflix Work?

    Shane Greenstein and Michael Norris

    In late 2013 and early 2014, Netflix service over the major U.S. Internet Service Providers (ISPs) suffered major slowdowns. What were the causes of these problems? What could Netflix do to solve them?

    Keywords: Digital Innovation; internet; broadband service; Internet; Technology; Infrastructure; Utilities Industry; United States;

    Citation:

    Greenstein, Shane, and Michael Norris. "Streaming Over Broadband: Why Doesn't My Netflix Work?" Harvard Business School Case 616-007, November 2015. (Revised April 2017.)  View Details
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Journal Articles

  1. Article | Journal of Law & Innovation

    Inconvenient Truths: Interpreting the Origins of the Internet

    Shane Greenstein

    A conventional economic narrative provides intellectual underpinnings for governments to subsidize research and development ("R&D") that coordinates risky research to benefit many in society. This essay compares this narrative with the origins and invention of the internet. Are the historical facts consistent with the conventional economic narrative? Does the conventional economic narrative offer a complete explanation for why government subsidized R&D related to the internet produced high economic value? The essay shows why that narrative is consistent with historical experience, and incomplete in crucial respects. To remedy incompleteness, an analyst needs to appreciate the role of lead-users and good governance of technology transfer. Accounting for such factors, the essay develops a number of implications for technology policy.

    Keywords: lead users; Technology Transfer; Internet; History; Analysis; Research and Development; Governance; Technology; Policy;

    Citation:

    Greenstein, Shane. "Inconvenient Truths: Interpreting the Origins of the Internet." Journal of Law & Innovation 3 (2020): 36–68.  View Details
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  2. Article | Journal of Economic Perspectives

    The Basic Economics of Internet Infrastructure

    Shane Greenstein

    The internet's structure and operations remain invisible to most economists. What determines the economic value of internet infrastructure and the incentives to improve it? What are the open research questions for the most salient policy issues? This article reviews the basic economics of internet infrastructure, focusing attention on the economic questions motivated by public aspirations for ubiquitous availability and widespread adoption of internet protocols.

    Keywords: Internet; Infrastructure; Operations; Economics; Value;

    Citation:

    Greenstein, Shane. "The Basic Economics of Internet Infrastructure." Journal of Economic Perspectives 34, no. 2 (Spring 2020): 192–214.  View Details
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  3. Article | Management Science | Forthcoming

    Ideology and Composition Among an Online Crowd: Evidence From Wikipedians

    Shane Greenstein, Grace Gu and Feng Zhu

    Online communities bring together participants from diverse backgrounds and often face challenges in aggregating their opinions. We infer lessons from the experience of individual contributors to Wikipedia articles about U.S. politics. We identify two factors that cause a tendency toward moderation in collective opinion: either biased contributors contribute less, which shifts the composition of participants, or biased contributors moderate their own views. Our findings show that shifts in the composition of participants account for 80% to 90% of the moderation in content. Contributors tend to contribute to articles with slants that are opposite of their own views. Evidence suggests that encountering extreme contributors with an opposite slant plays an important role in triggering the composition shift and changing views. These findings suggest that collective intelligence becomes more trustworthy when mechanisms encourage confrontation between distinct viewpoints. They also suggest, cautiously, that managers who aspire to produce content “from all sides” should let the most biased contributors leave the collective conversation if they can be replaced with more moderate voices.

    Keywords: online community; Collective Intelligence; ideology; bias; Wikipedia; Knowledge Sharing; Perspective; Government and Politics;

    Citation:

    Greenstein, Shane, Grace Gu, and Feng Zhu. "Ideology and Composition Among an Online Crowd: Evidence From Wikipedians." Management Science (forthcoming).  View Details
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  4. Article | Industrial and Corporate Change

    Technological Leadership (de)Concentration: Causes in Information and Communication Technology Equipment

    Yasin Ozcan and Shane Greenstein

    Using patent data from 1976 to 2010 as indicators of inventive activity, we determine the concentration level of where inventive ideas originate and then examine how and why those concentrations change over time. The analysis finds pervasive deconcentration in every area related to the Information and Communication Technology equipment market. We find that booms and busts play an important role in deconcentration trends. In comparison, new entry explains surprisingly little, and merger and acquisition activity does not revert the trend.

    Keywords: deconcentration; Technological Innovation; Innovation Leadership; Patents; Market Entry and Exit; Telecommunications Industry;

    Citation:

    Ozcan, Yasin, and Shane Greenstein. "Technological Leadership (de)Concentration: Causes in Information and Communication Technology Equipment." Industrial and Corporate Change 29, no. 2 (April 2020): 241–263.  View Details
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  5. Article | Telecommunications Policy

    The Persistence of Broadband User Behavior: Implications for Universal Service and Competition Policy

    Andre Boik, Shane Greenstein and Jeffrey Prince

    In several markets, firms compete not for consumer expenditure but consumer attention. We examine user priorities over the allocation of their time, and interpret that behavior in light of salient tensions in policy discussions over universal service, data caps, and related policy topics, such as merger analysis. Specifically, we use extensive microdata on user online choice to characterize the demand for the services offered online, which drives a household’s supply of attention. Our data cover a period of time that saw the introduction of many new and notable sites and new devices on which to access them. In our analysis, we assess “how” households supply their attention along various dimensions, such as their concentration of attention across the universe of sites and the amount of attention expenditure per domain visit. Remarkably, we find no change in “how” households allocated their attention despite drastically changing where they allocated it. Moreover, conditional on total attention expenditure, demographics entirely fail to predict our key measures of attention allocation decisions. We highlight several important implications, for policy and beyond, stemming from the persistence and demographic orthogonality of our novel attention measures.

    Keywords: broadband service; attention allocation; Consumer Behavior; Household; Internet; Competition; Policy;

    Citation:

    Boik, Andre, Shane Greenstein, and Jeffrey Prince. "The Persistence of Broadband User Behavior: Implications for Universal Service and Competition Policy." Telecommunications Policy 43, no. 8 (September 2019).  View Details
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  6. Article | MIS Quarterly

    Do Experts or Crowd-Based Models Produce More Bias? Evidence from Encyclopædia Britannica and Wikipedia

    Shane Greenstein and Feng Zhu

    Organizations today can use both crowds and experts to produce knowledge. While prior work compares the accuracy of crowd-produced and expert-produced knowledge, we compare bias in these two models in the context of contested knowledge, which involves subjective, unverifiable, or controversial information. Using data from Encyclopædia Britannica, authored by experts, and Wikipedia, an encyclopedia produced by an online community, we compare the slant and bias of pairs of articles on identical topics of U.S. politics. Our slant measure is less (more) than zero when an article leans towards Democratic (Republican) viewpoints, while bias is the absolute value of the slant. We find that Wikipedia articles are more slanted towards Democratic views than are Britannica articles, as well as more biased. The difference in bias between a pair of articles decreases with more revisions. The bias on a per word basis hardly differs between the sources because Wikipedia articles tend to be longer than Britannica articles. These results highlight the pros and cons of each knowledge production model, help identify the scope of the empirical generalization of prior studies comparing the information quality of the two production models, and offer implications for organizations managing crowd-based knowledge production.

    Keywords: online community; Collective Intelligence; wisdom of crowds; bias; Wikipedia; Britannica; knowledge production; Knowledge Sharing; Knowledge Dissemination; Prejudice and Bias;

    Citation:

    Greenstein, Shane, and Feng Zhu. "Do Experts or Crowd-Based Models Produce More Bias? Evidence from Encyclopædia Britannica and Wikipedia." MIS Quarterly 42, no. 3 (September 2018): 945–959.  View Details
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  7. Article | American Economic Review: Papers and Proceedings

    Invention and Agglomeration in the Bay Area: Not Just ICT

    Chris Forman, Avi Goldfarb and Shane Greenstein

    We document that the Bay Area rose from 4% of all successful US patent applications in 1976 to 16% in 2008. This is partly driven by the increase in the prevalence of information and communication technology; however, even for patents unrelated to information and communication technology, we see a disproportionate increase in the share of US patents from the Bay Area. We interpret this growth as a trend to coagglomeration in invention across technologies, and we explore different dimensions of this trend.

    Keywords: agglomeration; Technology; Patents; San Francisco;

    Citation:

    Forman, Chris, Avi Goldfarb, and Shane Greenstein. "Invention and Agglomeration in the Bay Area: Not Just ICT." American Economic Review: Papers and Proceedings 106, no. 5 (May 2016): 146–151.  View Details
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  8. Article | Information Systems Research

    Open Content, Linus' Law, and Neutral Point of View

    Shane Greenstein and Feng Zhu

    The diffusion of the Internet and digital technologies has enabled many organizations to use the open-content production model to produce and disseminate knowledge. While several prior studies have shown that the open-content production model can lead to high-quality output in the context of uncontroversial and verifiable information, it is unclear whether this production model will produce any desirable outcome when information is controversial, subjective, and unverifiable. We examine whether the open-content production model helps achieve a neutral point of view (NPOV) using data from Wikipedia's articles on U.S. politics. Our null hypothesis builds on Linus' Law, often expressed as "Given enough eyeballs, all bugs are shallow." Our findings are consistent with a narrow interpretation of Linus' Law, namely, a greater number of contributors to an article makes an article more neutral. No evidence supports a broad interpretation of Linus' Law. Moreover, several empirical facts suggest the law does not shape many articles. The majority of articles receive little attention, and most articles change only mildly from their initial slant. Our study provides the first empirical evidence on the limit of Linus' Law. While many organizations believe that they could improve their knowledge production by leveraging communities, we show that in the case of Wikipedia, there are aspects, such as NPOV, that the community does not always achieve successfully.

    Keywords: Prejudice and Bias; Online Technology; Balance and Stability; Operations; Knowledge Management; Knowledge Dissemination;

    Citation:

    Greenstein, Shane, and Feng Zhu. "Open Content, Linus' Law, and Neutral Point of View." Information Systems Research 27, no. 3 (September 2016): 618–635.  View Details
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Book Chapters
Books

  3. Book | 2016

    Innovation Policy and the Economy, Volume 17

    Shane Greenstein, Josh Lerner and Scott Stern

    The seventeenth volume of the National Bureau of Economic Research’s Innovation Policy and the Economy provides an accessible forum for bringing the work of leading academic researchers to an audience of policymakers and those interested in the interaction between public policy and innovation. In the first chapter, Joel Waldfogel discusses how reduced costs of production have resulted in a “Golden Age of Television,” arguing that this development has gone underappreciated. The second chapter, by Marc Rysman and Scott Schuh, discusses the prospects for innovation in payment systems, including mobile payments, faster payment systems, and digital currencies. In the third chapter, Catherine Tucker and Amalia Miller analyze the consequences of patient data becoming virtually costless to store, share, and individualize, showing how data management and privacy issues have become a key factor in health policy. The fourth chapter, by Michael Luca, examines how online marketplaces have proliferated over the past decade, evolving far beyond the pioneers such as eBay and Amazon. In the fifth chapter, Tim Bresnahan and Pai-Ling Yin characterize information and communication technologies in the workplace, addressing how wages vary with increasing demand for smart managers and professionals, and workers with organizational participation skills.

    Keywords: Innovation and Invention; Technological Innovation; Governance; Policy; Economy;

    Citation:

    Greenstein, Shane, Josh Lerner and Scott Stern, eds. Innovation Policy and the Economy, Volume 17. Chicago: University of Chicago Press, 2016.  View Details
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