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The Role of Consumers in Innovation Processes in Markets

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  • Nicole J. Saam

    (nicole.saam@soziologie.uni-muenchen.de)

Abstract

What is the effect of the fallible knowledge of consumers on knowledge accumulation in markets? This is the question which this article investigates based on Hayek’s evolutionary concept of competition as a discovery procedure and of Popper’s concept of fallible knowledge. The article presents results from a simulation model. It tests the hypothesis that the growth rate of knowledge accumulation of an industry should decrease with the increase in fallible knowledge of consumers. Surprisingly, under certain conditions, the growth rate of knowledge accumulation of an industry increases with the increase in fallible knowledge of consumers.

Suggested Citation

  • Nicole J. Saam, 2005. "The Role of Consumers in Innovation Processes in Markets," Rationality and Society, , vol. 17(3), pages 343-380, August.
    • Handle: RePEc:sae:ratsoc:v:17:y:2005:i:3:p:343-380
    DOI: 10.1177/1043463105055465
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    References listed on IDEAS

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    Cited by:

    1. Beata Cialowicz, 2020. "Consumer Loans in a Process of Diffusion of Innovations - an axiomatic analysis," Annals of Economics and Finance, Society for AEF, vol. 21(2), pages 393-414, November.

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