Physical Sciences and Mathematics Commons^™

Two Formulas For Success In Social Media: Learning And Network Effects, Liangfei Qiu, Qian Tang, Andrew B. Whinston

Research Collection School Of Computing and Information Systems

Recent years have witnessed an unprecedented explosion in information technology that enables dynamic diffusion of user-generated content in social networks. Online videos, in particular, have changed the landscape of marketing and entertainment, competing with premium content and spurring business innovations. In the present study, we examine how learning and network effects drive the diffusion of online videos. While learning happens through informational externalities, network effects are direct payoff externalities. Using a unique data set from YouTube, we empirically identify learning and network effects separately, and find that both mechanisms have statistically and economically significant effects on video views; furthermore, the …