3 Mental Models From Economics For Educators To Enhance Your Innovation
Enhance your innovation efforts with these three concepts.
Build your cognitive toolkit with this trio of mental models from economics and explore their relevance for innovation in education.
- The Network Effect
- Sunk Cost Fallacy
- Compounding
We will look at each model and consider ‘How does this connect with education innovation and leadership?’
The Network Effect
A commodities’ value grows with the number of people who use them.
This is labelled the positive network effect. As more people use something, more people are also motivated to join.
Think about the mobile technology that we use. Any person with an iPhone can communicate easily with another iPhone owner.
The network effect has helped Apple’s growth, but there is also the benefit to us. We perceive and gain more value from a phone when others are part of the network or technology ecosystem.
The Network Effect breaks down to another level of influence.
- Direct network effect
- Two-sided network effects
