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 effectsand 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.
Pegoretti, G., Rentocchini, F., Vittucci Marzetti, G. (2012). An agent-based model of innovation diffusion: network structure and coexistence under different information regimes. JOURNAL OF ECONOMIC INTERACTION AND COORDINATION, 7(2), 145-165 [10.1007/s11403-012-0087-4].
An agent-based model of innovation diffusion: network structure and coexistence under different information regimes
Vittucci Marzetti, G
2012
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 effectsand 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.File | Dimensione | Formato | |
---|---|---|---|
PegorettiRentocchiniVittucci2011.pdf
accesso aperto
Tipologia di allegato:
Other attachments
Dimensione
627.75 kB
Formato
Adobe PDF
|
627.75 kB | Adobe PDF | Visualizza/Apri |
I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.