Modeling Reputational and Informational Influences in Threshold Models of Bandwagon Innovation Diffusion

Authors:
Lori Rosenkopf;Eric Abrahamson
Affiliations:
The Wharton School, University of Pennsylvania, Philadelphia, PA 19104. rosenkopf@wharton.upenn.edu;Graduate School of Business, Columbia University, New York, NY 10027. eal@columbia.edu
Venue:
Computational & Mathematical Organization Theory
Year:
1999

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Abstract

Bandwagon innovation diffusion is characterized by apositive feedback loop where adoptions by some actors increase thepressure to adopt for other actors. In particular, when gains from aninnovation are difficult to quantify, such as implementing qualitycircles or downsizing practices, diffusion is likely to occur througha bandwagon process. In this paper we extend Abrahamson andRosenkopf‘s (1993) model of bandwagon diffusion to examine bothreputational and informational influences on this process. We findthat the distribution of reputations among the set of potentialadopters affects the extent of bandwagon diffusion under conditionsof moderate ambiguity, and we find that bandwagons occur even whenpotential adopters receive information about others‘ unprofitableexperiences with the innovation.