An agent-based model of innovation diffusion: network structure and coexistence under different information regimes
An agent-based model of innovation diffusion: network structure and coexistence under different information regimes
The paper analyzes how the structure of social networks affects innovation diffusion and competition under different information regimes. Diffusion is modeled as the result of idiosyncratic adoption thresholds, local network effects and information diffusion (broadcasting and demonstration effect from previous adopters). A high social cohesion decreases the probability of one innovation cornering the market. Nonetheless, with imperfect information, in small-world networks the higher speed of diffusion produced by the low average distance increases this probability. A low social cohesion also increases the probability of falling into traps of under-adoption. However, such probability is significantly lower with imperfect information, because such regime is characterized by higher levels of market concentrations and this reduces the frictions due to the coexistence of non-compatible product innovations.
145-165
Pegoretti, Giovanni
310a3711-602a-4a57-9a03-93726ca188c7
Rentocchini, Francesco
8ee609a8-8a3f-4a86-94be-5050f7d8c1cb
Marzetti, Giuseppe Vittucci
abf08ceb-2685-4cd0-aa6c-670db4c4b842
2012
Pegoretti, Giovanni
310a3711-602a-4a57-9a03-93726ca188c7
Rentocchini, Francesco
8ee609a8-8a3f-4a86-94be-5050f7d8c1cb
Marzetti, Giuseppe Vittucci
abf08ceb-2685-4cd0-aa6c-670db4c4b842
Pegoretti, Giovanni, Rentocchini, Francesco and Marzetti, Giuseppe Vittucci
(2012)
An agent-based model of innovation diffusion: network structure and coexistence under different information regimes.
Journal of Economic Interaction and Coordination, 7 (2), .
(doi:10.1007/s11403-012-0087-4).
Abstract
The paper analyzes how the structure of social networks affects innovation diffusion and competition under different information regimes. Diffusion is modeled as the result of idiosyncratic adoption thresholds, local network effects and information diffusion (broadcasting and demonstration effect from previous adopters). A high social cohesion decreases the probability of one innovation cornering the market. Nonetheless, with imperfect information, in small-world networks the higher speed of diffusion produced by the low average distance increases this probability. A low social cohesion also increases the probability of falling into traps of under-adoption. However, such probability is significantly lower with imperfect information, because such regime is characterized by higher levels of market concentrations and this reduces the frictions due to the coexistence of non-compatible product innovations.
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Published date: 2012
Organisations:
Strategy, Innovation & Entrepreneurship
Identifiers
Local EPrints ID: 357289
URI: http://eprints.soton.ac.uk/id/eprint/357289
ISSN: 1860-711X
PURE UUID: 6c483717-23f7-43d7-bd8d-9d1ac5860f81
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Date deposited: 07 Oct 2013 10:52
Last modified: 14 Mar 2024 14:57
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Author:
Giovanni Pegoretti
Author:
Giuseppe Vittucci Marzetti
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