Agent-based modeling simulation under local network externality

Authored by Arnut Paothong, G. S. Ladde

Date Published: 2014-04

DOI: 10.1007/s11403-013-0110-4

Sponsors: United States Army

Platforms: No platforms listed

Model Documentation: Other Narrative Flow charts Mathematical description

Model Code URLs: Model code not found

Abstract

In general, consumer utility of network goods is affected by the entire network size. The socio-cultural-economic affinities of consumers influence the network externality processes. In this work, we treat a consumer decision as a consumer decision dynamic process. We then formulate a dynamic structural representation of a consumer network structure, structure of utility function and decision rule under the influence of local network externality concept. This formulation generates a mathematical model for a consumer decision dynamic process. The byproduct of the dynamic model leads to an agent-based simulation model. The simulation model is used to investigate different types of consumer decision dynamic market equilibriums. Moreover, prototype illustrations are given to exhibit the association between network attributes and its market equilibriums.

Tags

Network Structure Agent-based simulation model Duopoly market Hotelling location model Local network externality Mathematical model of decision dynamic process Structure of utility function