Agent-based simulation of lock-in dynamics in a duopoly

Garlick, Michael and Chli, Maria (2010). Agent-based simulation of lock-in dynamics in a duopoly. IN: 9th International Joint Conference on Autonomous Agents and Multiagent Systems. 2010-05-10 - 2010-05-14.

Abstract

Lock-in is observed in real world markets of experience goods; experience goods are goods whose characteristics are difficult to determine in advance, but ascertained upon consumption. We create an agent-based simulation of consumers choosing between two experience goods available in a virtual market. We model consumers in a grid representing the spatial network of the consumers. Utilising simple assumptions, including identical distributions of product experience and consumers having a degree of follower tendency, we explore the dynamics of the model through simulations. We conduct simulations to create a lock-in before testing several hypotheses upon how to break an existing lock-in; these include the effect of advertising and free give-away. Our experiments show that the key to successfully breaking a lock-in required the creation of regions in a consumer population. Regions arise due to the degree of local conformity between agents within the regions, which spread throughout the population when a mildly superior competitor was available. These regions may be likened to a niche in a market, which gains in popularity to transition into the mainstream.

Divisions: Engineering & Applied Sciences > Computer Science
Additional Information: © IFAAMAS
Event Title: 9th International Joint Conference on Autonomous Agents and Multiagent Systems
Event Type: Other
Event Dates: 2010-05-10 - 2010-05-14
Uncontrolled Keywords: simulation and modelling,model development,modelling methodologies,economics,sociology,experimentation,human factors,agent-based simulation,consumer behaviour,lock-in
Full Text Link: http://www.cse. ... u.ca/AAMAS2010/
Related URLs:
Published Date: 2010
Authors: Garlick, Michael
Chli, Maria ( 0000-0002-2840-4475)

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