A theory based dynamical model of innovation processes

We present an agent-based model of innovation processes, based upon a theory of innovation by Lane and Maxfield. The theory inspires and constrains the features of the model, thus reducing the embarasse de richesse that is one of the major methodological problems of agent-based modeling. Artifacts are produced by agents using recipes; the basic dynamics, absent innovation, is one of production and sales, where the external world supplies “raw materials” and external demand. Depending upon the initial conditions, self-sustaining cycles of production and exchange can emerge among the agents. Innovation – that is, the generation of new recipes, in particular desired directions, called “goals” – results in substantial modification of the system dynamics. Two innovation regimes are introduced: a “lonely” mode, in which each agent tries to introduce new products by itself, and a “relational” mode, in which two agents can improve their reciprocal knowledge and can decide to try to jointly develop a new artifact.