Path dependence is defined by nonpredictability, nonergodicity, inflexibility, and inefficiency.

Evidence

It is difficult to conceptualize the general logic of this type of entrapping process. Arthur (1994; see also Pierson, 2000: 253) has advanced its most explicit characterization. In his view the process of becoming path dependent can be characterized by four general properties: … 1. Nonpredictability—there is an indeterminacy of outcome. 2. Nonergodicity—several outcomes are possible (multiple equilibria), and history selects among the possible alternatives. 3. Inflexibility—the actors are entrapped, so a shift to another option is impossible. 4. Inefficiency—actions resulting from the path lock the market into an inferior solution. — Jörg Sydow, Georg Schreyögg, and Jochen Koch, Organizational Path Dependence, 19

Categorization

• DEFINE: Crisp, quotable four-property definition of path dependence worth keeping as a reference checklist.
• SEED: Article angle: testing these four properties against cases where markets supposedly ‘chose wrong’ — e.g. Betamax vs. VHS, or platform standards today.