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The Random Part in Network Evolution

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Author Info
Thomas Grebel () (Economics Department, University of Jena)

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Abstract

Economic behavior strives for efficiency. Therefore, also evolving network structures should be a result of such a goal-oriented behavior. Traditionally, networks were assumed to be only temporary phenomena, since the prevailing organizational forms that comply with the efficiency postulate are either firms or markets. Having a goal in mind, however, does not incur a set of unique choices of action, especially in situations under high uncertainty when engaging in invention networks. Consequently, there is no uniqueness in network structures. There is a random part in network evolution driven by generic mechanisms. A percolation model is used to model the generic development of invention networks. A Monte-Carlo simulation underlines the expectable patterns of network evolution. Moreover, it is tried to align the generic part of the story to the operant level where entrepreneurial behavior and market selection takes over the dominant role in network formation.

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Publisher Info
Paper provided by Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics, Thueringer Universitaets- und Landesbibliothek in its series Jena Economic Research Papers in Economics with number 2009-039.

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Date of creation: 25 May 2009
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Handle: RePEc:jrp:jrpwrp:2009-039

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Related research
Keywords: R&D cooperation; percolation theory; knowledge diffusion; networks;

Find related papers by JEL classification:
A10 - General Economics and Teaching - - General Economics - - - General
B10 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - General
B21 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Microeconomics
B25 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Historical; Institutional; Evolutionary; Austrian
B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology
B52 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Institutional; Evolutionary
C15 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: General - - - Statistical Simulation Methods
D03 - Microeconomics - - General - - - Behavioral Economics; Underlying Principles
D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
I10 - Health, Education, and Welfare - - Health - - - General
O10 - Economic Development, Technological Change, and Growth - - Economic Development - - - General
O33 - Economic Development, Technological Change, and Growth - - Technological Change - - - Technological Change: Choices and Consequences; Diffusion Processes

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