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Self-Organizing Innovation Networks: When do Small Worlds Emerge?

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Author Info
Nicolas CARAYOL (BETA)
Pascale ROUX (GRES-LEREPS)

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Abstract

In this paper, we present a model of 'collective innovation' built upon the network formation formalism. In our model, agents localized on a circle benefit from knowledge flows from other agents with whom they are directly or indirectly connected. They support costs for direct connections which are linearly increasing with geographic distance. The dynamic process of network formation exhibits prefeRential meeting for close agents (in the relational network and in the geographic metrics). We show how the set of stochastically stable networks selected in the long run is affected by the degree of knowledge transferability. We find critical values of this parameter for which stable \"small world\" networks are dynamically selected.

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Paper provided by Groupement de Recherches Economiques et Sociales in its series Cahiers du GRES with number 2003-08.

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Date of creation: 2003
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Handle: RePEc:grs:wpegrs:2003-08

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Related research
Keywords: Network Formation; Stochastic Stability; Preferential Meeting; Self-Organization;

Find related papers by JEL classification:
C62 - Mathematical and Quantitative Methods - - Mathematical Methods and Programming - - - Existence and Stability Conditions of Equilibrium
C63 - Mathematical and Quantitative Methods - - Mathematical Methods and Programming - - - Computational Techniques
C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
O31 - Economic Development, Technological Change, and Growth - - Technological Change - - - Innovation and Invention: Processes and Incentives
R10 - Urban, Rural, and Regional Economics - - General Regional Economics - - - General

References listed on IDEAS
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  1. Cowan,Robin, 2004. "Network models of innovation and knowledge diffusion," Research Memoranda 016, Maastricht : MERIT, Maastricht Economic Research Institute on Innovation and Technology. [Downloadable!]
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