An agent-based model of product competition: network structure and coexistence under different information regimes
AbstractThe paper analyzes how the structure of interaction networks affects the diffusion patterns and market shares of different products in case of local network externalities and imperfect information. The diffusion of the different products/technologies in the market is modelled as the result of two (only partly) interrelated dynamics: i) the interaction between idiosyncratic individual thresholds and local network externalities; ii) the diffusion of the information about the product (via broadcast diffusion and word-of-mouth). The average clustering coefficient affects the overall outcome and the actual possibility that one product corners the market. Moreover, in case of small-world networks, despite the high clustering coefficient which increases the probability of an outcome with coexistence, the increase in the speed of diffusion impinges on the actual realization of such an outcome in case of sequential entry of the different technologies and/or imperfect information.
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Bibliographic InfoPaper provided by Public policies and local development in its series Openloc Working Papers with number 0916.
Date of creation: 2009
Date of revision:
Agent-based model; innovation di usion; network e ects; social networks; small-world;
Find related papers by JEL classification:
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
- D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
- M31 - Business Administration and Business Economics; Marketing; Accounting - - Marketing and Advertising - - - Marketing
- O33 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
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.:
- López-Pintado, Dunia, 2008.
"Diffusion in complex social networks,"
Games and Economic Behavior,
Elsevier, vol. 62(2), pages 573-590, March.
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