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Threshold Rule and Scaling Behavior in a Multi-Agent Supply Chain

In: Progress in Artificial Economics

Author

Listed:
  • Valerio Lacagnina

    (University of Palermo)

  • Davide Provenzano

    (University of Palermo)

Abstract

In this paper an agent-based model of self organized criticality is developed in a network economy characterized by lead time and a threshold behavior of firms. Instead of considering the aggregate production of the economy as a whole, we focus on both the propagation and amplification effects of a demand shock in the sectorial productions of a multi-agent supply chain. We study a static network structure representing a relation of firms in a lower-upper stream in an industrial organization. In our model, the individual (R, nQ) policies play an important role in generating a propagation effect across the different layers of the economy, and the propagation turns into the large fluctuations and amplifications of sectorial productions.

Suggested Citation

  • Valerio Lacagnina & Davide Provenzano, 2010. "Threshold Rule and Scaling Behavior in a Multi-Agent Supply Chain," Lecture Notes in Economics and Mathematical Systems, in: Marco Li Calzi & Lucia Milone & Paolo Pellizzari (ed.), Progress in Artificial Economics, pages 139-150, Springer.
    • Handle: RePEc:spr:lnechp:978-3-642-13947-5_12
    DOI: 10.1007/978-3-642-13947-5_12
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