changing in time, driven by the activities or decisions of those very components. In the connected age, therefore, what happens and how it happens depend on the network. And the network in turn depends on what has happened previously. (Watts 2003, p. 28) As with all complex systems, the costs and benefits associated with any one component cannot be assessed without an appreciation for the function it plays The literature on network externalities is vast. For the seminal articles, see Rohlfs (1974); Farrell and Saloner (1985); and Katz and Shapiro (1985). For a survey appearing in the legal literature, see Lemley and McGowan (1998). Introduction within the system as a whole. Each network is designed SO that each element interacts with other elements in ways that analysis of individual elements cannot adequately take into account. Thus, the impact of compelling access to a particular network component can only be understood if one has a theoretical model of the interrelationship of the network's various constituent parts. D. Network Law and Economics This book is designed to overcome these conceptual limitations and to place the issues surrounding network economics and policy on a sounder economic and legal foundation. We begin by demystifying networks as an economic phenomenon by offering a more precise definition of what constitutes a network. The terminology we establish not only provides a technical background for our study; it also provides important insights into network design. In addition, we offer a more general theory of networks that makes it possi- ble to analyze how networks function as integrated systems based on the critical engineering and management processes employed for the design and operation of networks. Our theory applies and extends the insights provided by the mathematics associated with graph theory, which has served as the foundation for a substantial scientific literature on the science of networks that has been largely overlooked by economists, legal academics, and policymakers. The rap