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Innovation creation and diffusion in a social network: an agent based approach

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  • Lamieri, Marco
  • Ietri, Daniele

Abstract

Market is not only the result of the behaviour of agents, as we can find other forms of contact and communication. Many of them are determined by proximity conditions in some kind of space: in this paper we pay a particular attention to relational space, that is the space determined by the relationships between individuals. The paper starts from a brief account on theoretical and empirical literature on social networks. Social networks represent people and their relationships as networks, in which individuals are nodes and the relationships between them are ties. In particular, graph theory is used in literature in order to demonstrate some properties of social networks summarised in the concept of Small Worlds. The concept may be used to explain how some phenomena involving relations among agents have effects on multiple different geographical scales, involving both the local and the global scale. The empirical section of the paper is introduced by a brief summary of simulation techniques in social science and economics as a way to investigate complexity. The model investigates the dynamics of a population of firms (potential innovators) and consumers interacting in a space defined as a social network. Consumers are represented in the model in order to create a competitive environment pushing enterprises into innovative process (we refer to Schumpeter’s definition): from interaction between consumers and firms innovation emerges as a relational good.

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File URL: http://mpra.ub.uni-muenchen.de/445/
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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 445.

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Date of creation: 27 Apr 2004
Date of revision: 20 Oct 2006
Handle: RePEc:pra:mprapa:445

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Keywords: Innovation; small world; computational economics; network; complexity;

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  1. Cowan,Robin & Jonard,Nicolas, 1999. "Network Structure and the Diffusion of Knowledge," Research Memorandum 026, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
  2. Nigel Gilbert & Pietro Terna, 2000. "How to build and use agent-based models in social science," Mind and Society: Cognitive Studies in Economics and Social Sciences, Fondazione Rosselli, vol. 1(1), pages 57-72, March.
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