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Evaluating the market potential of innovations: A structured survey of diffusion models


  • Alexander Frenzel Baudisch

    () (Max-Planck-Institute for Economics, Evolutionary Economics Unit)

  • Hariolf Grupp

    (Fraunhofer Institute for Systems and Innovation Research)


This paper provides a systematic methodology to identify general innovation diffusion patterns in a given case study: First, an analytical framework is introduced which structures a review of innovation diffusion research. This framework may be used to structure the analysis of a case study. Second, a classification of innovation diffusion models is developed by focusing on the analytical hypotheses and stylized facts, which they assume. This categorization allows selecting appropriate models for a given case study based on the matching of the model's hypotheses and case study's characteristics. This provides an structured approach to allow innovators to evaluate ex-ante the market potential and the diffusion process, i.e. commercial success of their new product or practice. The paper concludes with critical recommendations on the use of innovation diffusion models. Based on the systematic approach to survey diffusion models, future research opportunities are outlined.

Suggested Citation

  • Alexander Frenzel Baudisch & Hariolf Grupp, 2006. "Evaluating the market potential of innovations: A structured survey of diffusion models," Jenaer Schriften zur Wirtschaftswissenschaft (Expired!) 21/2006, Friedrich-Schiller-Universität Jena, Wirtschaftswissenschaftliche Fakultät.
  • Handle: RePEc:jen:jenasw:2006-21

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    References listed on IDEAS

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    12. W. Kwasnicki, 2007. "Schumpeterian Modelling," Chapters,in: Elgar Companion to Neo-Schumpeterian Economics, chapter 25 Edward Elgar Publishing.
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    Innovation diffusion model; case study methodology; taxonomy; forecasting;

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