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Complex Dynamics in a Simple Model of Economic Specialization

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  • Andrea Mario Lavezzi

Abstract

This paper studies the dynamics of economic growth based on specialization in a network structure belonging to the family of Cellular Automata. The basic mechanism for the diffusion of specialization is the one identified by Allyn Young (1928): the specialization of some agents represents an increase in the extent of the market for others and may facilitate their specialization. We show that the the diffusion of specialization generally increases: i) with an increase of the dimension of the neighborhood, ii) with a reduction of the extent of the market necessary for specialization and iii) with a reduction of the extent of the market necessary to remain specialized (or with a reduction of the intensity of competition). The same parameters affect the qualitative features of the dynamics: the network configuration may not settle to a steady state and display a complex network dynamics. We also discuss the role of initial conditions of the dynamical system and the activation rules, that we relate to the organization of the economic activity.

Suggested Citation

  • Andrea Mario Lavezzi, "undated". "Complex Dynamics in a Simple Model of Economic Specialization," Discussion Papers 2003/2, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
  • Handle: RePEc:pie:dsedps:2003/2
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    Cited by:

    1. Fanti, Luciano & Gori, Luca, 2010. "Child policy solutions for the unemployment problem," Economics Letters, Elsevier, vol. 109(3), pages 147-149, December.
    2. Luciano Fanti & Luca Gori, 2009. "Longevity, fertility and PAYG pension systems sustainability," Discussion Papers 2009/77, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    3. Luciano Fanti & Luca Gori, 2012. "Endogenous Lifetime in an Overlapping-Generations Small Open Economy," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 68(2), pages 121-152, June.
    4. Elisa Giuliani, 2010. "Clusters, Networks and Economic Development: An Evolutionary Economics Perspective," Chapters,in: The Handbook of Evolutionary Economic Geography, chapter 12 Edward Elgar Publishing.
    5. Marco Guerrazzi, 2005. "Notes on Continuous Dynamic Models: the Benhabib-Farmer Condition for Indeterminacy," Discussion Papers 2005/54, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    6. Luciano Fanti & Luca Gori, 2011. "On economic growth and minimum wages," Journal of Economics, Springer, vol. 103(1), pages 59-82, May.
    7. Manuela Gussoni - Andrea Mangani, 2009. "The impact of public funding for innovation on firms' R&D investments: Do R&D cooperation and appropriability matter?," Discussion Papers 2009/90, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    8. Pompeo Della Posta, 2003. "Optimal Monetary Instruments and Policy Games Reconsidered," Discussion Papers 2003/12, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    9. Lorenzo Corsini & Pier Mario Pacini & Luca Spataro, 2010. "Workers' Choice on Pension Schemes: an Assessment of the Italian TFR Reform Through Theory and Simulations," Discussion Papers 2010/96, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    10. Lorenzo Corsini & Elisabetta Olivieri, 2008. "Technological Change and the Wage Differential between Skilled and Unskilled Workers: Evidence from Italy," Discussion Papers 2008/73, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    11. Luca Gori, 2009. "Endogenous fertility, family policy and multiple equilibria," Discussion Papers 2009/79, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    12. Luciano Fanti & Luca Gori, 2009. "Endogenous fertility, endogenous lifetime and economic growth: the role of health and child policies," Discussion Papers 2009/91, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    13. Maurizio Lisciandra, 2007. "The Role of Reciprocating Behaviour in Contract Choice," Discussion Papers 2007/65, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    14. Luciano Fanti & Luca Gori, 2008. "PAYG pensions and economic cycles: exogenous versus endogenous fertility," Discussion Papers 2008/75, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.

    More about this item

    Keywords

    Specialization; Economic Growth; Cellular Automata;

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

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