Emergence and resilience in a model of innovation and network formation. (English) Zbl 1338.90088
Summary: This paper studies the resilience of an evolving network of rationality bounded firms engaged in an active search to improve their technological capability through interaction with knowledge-heterogeneous neighbors. Firms update their observed neighborhood by adopting a specific search routine. It is shown that through simple heuristics their adaptive behavior translates into an emerging pattern of aggregate technological performance. Simulations assess the system resilience in terms of its capability to recover aggregate performance when subjected to periodic arrivals of innovation shocks. The paper argues that the routine firms adopt, chosen by tuning between either global or local search protocols, is crucial to determine the system’s aggregate performance and resilience.
MSC:
| 90B15 | Stochastic network models in operations research |
| 91B54 | Special types of economic markets (including Cournot, Bertrand) |
| 91A40 | Other game-theoretic models |
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