History matters. Where you have been in the past determines where you are now and where you can go in future. Indeed, even small, apparently trivial, differences in the path you have taken can have huge consequences for where you are and can go. In Economics, path dependence refers to the way in which apparently insignificant events and choices can have huge consequences for the development of a market or an economy.
Economists disagree over how widespread path dependence is, and whether it is a form of market failure. One focus of this debate is the QWERTY keyboard. Some argue that the QWERTY design was deliberately made slow to use so as to overcome a jamming-at-speed problem in early typewriters. Much faster alternative layouts of keys such as DVORAK have failed to prosper, even though the anti-jamming rationale for QWERTY has been defunct for years. This is a subject of much debate as some see this as the market’s failure to chose the better good. Others say that the QWERTY system’s success is a triumph of market forces due to the following reason that having invested in learning to make and use the QWERTY keyboard, it makes no economic sense to switch to an alternative that is not much better than QWERTY.