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Industry dynamics in complex product spaces: An evolutionary model

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  • Marengo, Luigi
  • Valente, Marco

Abstract

In this paper we present an evolutionary simulation model of industry dynamics with product innovation and differentiated demand in complex product industries, i.e. industries where products are made of many components, possibly belonging to different technologies, and providing a variety of services to consumers who have heterogeneous preferences. We analyze how the complexity of the product space, the strategies that firms follow to search this space either innovating or imitating, and the differentiation of consumers' preference interact to determine the structure and evolutions of the industry.

Suggested Citation

  • Marengo, Luigi & Valente, Marco, 2010. "Industry dynamics in complex product spaces: An evolutionary model," Structural Change and Economic Dynamics, Elsevier, vol. 21(1), pages 5-16, March.
  • Handle: RePEc:eee:streco:v:21:y:2010:i:1:p:5-16
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    References listed on IDEAS

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    1. Tommaso Ciarli & Riccardo Leoncini & Sandro Montresor & Marco Valente, 2008. "Technological change and the vertical organization of industries," Journal of Evolutionary Economics, Springer, vol. 18(3), pages 367-387, August.
    2. Luigi Marengo & Corrado Pasquali & Marco Valente & Giovanni Dosi, 2012. "Appropriability, patents, and rates of innovation in complex products industries," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 21(8), pages 753-773, November.
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    7. Herbert Dawid & Marc Reimann, 2011. "Diversification: a road to inefficiency in product innovations?," Journal of Evolutionary Economics, Springer, vol. 21(2), pages 191-229, May.
    8. Marco Valente, 2008. "Pseudo-NK: an Enhanced Model of Complexity," LEM Papers Series 2008/26, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
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    Citations

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    Cited by:

    1. Carreira, Carlos & Teixeira, Paulino, 2011. "Entry and exit as a source of aggregate productivity growth in two alternative technological regimes," Structural Change and Economic Dynamics, Elsevier, vol. 22(2), pages 135-150, June.
    2. Jun, Bogang & Kim, Tai-Yoo, 2015. "A neo-Schumpeterian perspective on the analytical macroeconomic framework: The expanded reproduction system," Hohenheim Discussion Papers in Business, Economics and Social Sciences 11-2015, University of Hohenheim, Faculty of Business, Economics and Social Sciences.
    3. Cevikarslan, Salih, 2013. "Heterogeneity in innovation strategies, evolving consumer preferences and market structure: An evolutionary multi-agent based modelling approach," MERIT Working Papers 019, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    4. Cevikarslan, Salih, 2013. "Optimal patent length and patent breadth in an R&D driven market with evolving consumer preferences: An evolutionary multi-agent based modelling approach," MERIT Working Papers 020, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    5. Cevikarslan S., 2015. "Research joint ventures in an R&D driven market with evolving consumer preferences: An evolutionary multi-agent based modelling approach," MERIT Working Papers 007, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).

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