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Heterogeneity vs. externalities in technological competition: A tale of possible technological landscapes

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Author Info
Jean-Michel Dalle () (Ecole Polytechnique & IEPE-CNRS, 59-61, rue Pouchet, F-75017 Paris, France)

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Abstract

The article presents a stochastic interaction model based on Gibbs random fields to analyze technological competition in a population of heterogeneous adopters with local or global externalities. The relationships between both heterogeneity and externalities and imperfect and asymmetric information are first emphasized. When local externalities and heterogeneity coexist, the technological landscapes of the industry are then shown to depend on the relative influence of these two parameters, with a phase transition: technologies coexist either in approximately equal market shares when heterogeneity is high enough or with one of the technologies only surviving in technological niches when local externalities dominate. Niches do also spontaneously appear: technological options survive in economic space due to the existence of some amount of heterogeneity among agents. On the contrary, when global externalities are added, pure standardization almost always occurs. We finally argue that different public policies should be designed so as to fit with different technological landscapes.

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Publisher Info
Article provided by Springer in its journal Journal of Evolutionary Economics.

Volume (Year): 7 (1997)
Issue (Month): 4 ()
Pages: 395-413
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Handle: RePEc:spr:joevec:v:7:y:1997:i:4:p:395-413

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Related research
Keywords: Externalities ; Heterogeneity ; Local interactions ; Global interactions ; Phase transition ; Standardization ; Stochastic models ; Technological competition ; Technological niches ; Economic landscapes;

Find related papers by JEL classification:
C00 - Mathematical and Quantitative Methods - - General - - - General
O33 - Economic Development, Technological Change, and Growth - - Technological Change - - - Technological Change: Choices and Consequences; Diffusion Processes
R10 - Urban, Rural, and Regional Economics - - General Regional Economics - - - General

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Koen Frenken, 2006. "Technological innovation and complexity theory," Economics of Innovation and New Technology, Taylor and Francis Journals, vol. 15(2), pages 137-155, March. [Downloadable!] (restricted)
  2. Albert Faber & Koen Frenken, 2008. "Models in evolutionary economics and environmental policy: Towards an evolutionary environmental economics," Innovation Studies Utrecht (ISU) working paper series 08-15, Utrecht University, Department of Innovation Studies, revised Apr 2008. [Downloadable!]
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This page was last updated on 2009-12-8.


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