Cellular Automata with network incubation in information technology diffusion

Renato Guseo and Mariangela Guidolin

Physica A: Statistical Mechanics and its Applications, 2010, vol. 389, issue 12, 2422-2433

Abstract: Innovation diffusion of network goods determines direct network externalities that depress sales for long periods and delay full benefits. We model this effect through a multiplicative dynamic market potential driven by a latent individual threshold embedded in a special Cellular Automata representation. The corresponding mean field approximation of its aggregate version is a Riccati equation with a closed form solution. This allows the detection of a change-point time separating an incubation period from a subsequent take-off due to a collective threshold (critical mass). Weighted nonlinear least squares are the main inferential methodology. An application is analysed with reference to USA fax machine diffusion.

Keywords: Network externalities; Threshold diffusion models; Chilling effect; Cellular Automata; Riccati equation; Generalized Bass model; NLS (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (12)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:phsmap:v:389:y:2010:i:12:p:2422-2433

DOI: 10.1016/j.physa.2010.02.007

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