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Scott Swisher Profile


Scott does empirical interdisciplinary research at the intersection of industrial organization, networks, and economic history. Scott works with economic models where intermediary firms build connections using a network technology, for example railroad companies building railroad lines or Internet service providers connecting households to the Internet's network backbone. These firms want to maximize their own profits given what their competitors are doing, and they own a small piece of a larger network like the national rail network or Internet. Network theory, which originated in pure mathematics and has recently branched out to applications in sociology, computer science, and economics, provides a language to think about the choices of these firms. As originally seen in mathematics, specifically combinatorial optimization, problems of this type are difficult to solve because of the large number of possible network configurations, some of which end up being stable when every firm does the best that it can. An important part of Scott's research is how to deal with these computational issues when taking the model to data. It is also important to account for the historical and regulatory environment in which the firms operate since this sets the technology and "rules of the game" by which firms compete. Finally, since the firms are strategic in their investment choices when building network connections, insight from game theory is needed to determine how they collectively behave when maximizing their profits.

From a historical perspective, Scott has applied this framework to quantify the effect of railroads on economic growth in the United States in the 19th century, finding that railroads were much more important to growth than previously thought. With two competing transport technologies of railroads and canals, he finds that canal companies drastically reconfigure their networks in the absence of railroads. This revision of canals only partially substitutes for the missing railroads, leading to large output and welfare losses when firms are no longer able to build railroad connections. In current work, Scott is examining the empirical effect of "network neutrality" regulation on the price, service quality, and investment choices of Internet service providers in the US. Findings in this line of work will inform US policymakers, such as the Federal Communications Commission and US Congress, on optimal regulation policy for firms operating the network technology of "last mile" Internet connections.
« January 2017 »