Marco Lamieri

Innovation creation and diffusion in a social network: an agent based approach

Market is not only the result of the behaviour of agents, as we can find other forms of contact and communication. Many of them are determined by proximity conditions in some kind of space: in this paper we pay a particular attention to relational space, that is the space determined by the relationships between individuals. The paper starts from a brief account on theoretical and empirical literature on social networks. Social networks represent people and their relationships as networks, in which individuals are nodes and the relationships between them are ties. In particular, graph theory is used in literature in order to demonstrate some properties of social networks summarised in the concept of Small Worlds. The concept may be used to explain how some phenomena involving relations among agents have effects on multiple different geographical scales, involving both the local and the global scale. The empirical section of the paper is introduced by a brief summary of simulation techniques in social science and economics as a way to investigate complexity. The model investigates the dynamics of a population of firms (potential innovators) and consumers interacting in a space defined as a social network. Consumers are represented in the model in order to create a competitive environment pushing enterprises into innovative process (we refer to Schumpeter’s definition): from interaction between consumers and firms innovation emerges as a relational good.

What If Hayek Goes Shopping in the Bazaar

The paper presents a comparative analysis of the peculiar institutional features of two retail markets: the middle eastern Bazaar and the western Mall (shopping center). We study the informational functions and performance of the different market institutions using an Agent Based Computational Economics (ACE) model under the assumption of behavioral learning by agents. Sellers decide which price setting strategy to adopt whereas buyers form their price beliefs exploring the market and decide which price to accept. The agents learn how to adapt and behave within the specific institutional framework to carry out their economic transactions, but market institutions, as mechanisms to coordinate information of market participants are expected to affect the price dynamics. The main area of interest concerns the question of whether the economic argument on the presumed underperformance of bazaar institutions respect to more competitive markets holds true or it is necessary a reassessment on it.