ADDER: A new model for simulating the evolution of technology

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Poster session slides for ADDER paper. Presented in DRUID 2012 conference in June 2012 in Copenhagen.

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ADDER: A new model for simulating the evolution of technology

  1. 1. ADDER a new model for simulating the evolution of technology, with observations on why perfectly knowledgeable agents cannot launch technological revolutionsJanne M. Korhonen, Aalto University School of Economics Julia Kasmire, Delft University of Technology
  2. 2. Background• From the viewpoint of social scientist, existing simulation models of technology evolution have several issues• Environments are exogenous and static• Internal “structure” of technologies is missing
  3. 3. The requirements:1. Early technologies form using existing primitive technologies as components.2. These new technologies in time become possible components, or building blocks, for the construction of further new technologies.3. This implies that technologies have an internal structure, a hierarchy of subsystems and sub-subsystems.4. The complex technologies form using simpler ones as components.5. The overall collection of technologies bootstraps itself upward from the few to the many and from the simple to the complex.6. The evolution of technology happens both as a result of essentially random events and boundedly rational search for and evaluation of new solutions.
  4. 4. Solution: the ADDER• Inspired by Arthur & Polak’s logic circuit model of technological evolution (2006, 2009)• Models endogenous change• Models internal structures• Is easy to implement (even for a social scientist)
  5. 5. Advantages• Models (or allows to model) easily several stylized facts of technological evolution:• Obsolescence, including “waves of destruction”• Keystone technologies• Bounded rationality• Variable difficulty of search
  6. 6. Nelson (2005): two key variables seem tocontrol the rate and direction of technologicaladvance:1. the strength of technological understanding2. the knowledge of user needsThe hypothesis was tested by building a modelincorporatinga. uncertainty about technologiesb. uncertainty about user needsc. a learning curve for both
  7. 7. Example:Nelson (2005): two key variables seem tocontrol the rate and direction of technologicaladvance:1. the strength of technological understanding2. the knowledge of user needsThe hypothesis was tested by building a modelincorporatinga. uncertainty about technologiesb. uncertainty about user needsc. a learning curve for both
  8. 8. Example: rational agents and (un)certain needsNelson (2005): two key variables seem tocontrol the rate and direction of technologicaladvance:1. the strength of technological understanding2. the knowledge of user needsThe hypothesis was tested by building a modelincorporatinga. uncertainty about technologiesb. uncertainty about user needsc. a learning curve for both
  9. 9. no uncertainty lots of uncertainty TechnologyTech level time time
  10. 10. no uncertainty lots of uncertainty TechnologyTech level time time Uncertainty about outcomes seems to be necessary for technological development!
  11. 11. Details• Very simple idea:• Simulation starts with primitive technology (“1”)• Goal is to satisfy needs, expressed as real numbers (e.g. 5, 8, 14, 45, 106)• New technologies are arithmetical expressions (e.g. 1 + 1 + 1 - 1 = 3)• Developed technologies* can serve as components (e.g. 1 + 1 + 3 = 5) * Provided the technology is among the list of “possible” technologies
  12. 12. Details (2)• Criteria for successful technologies; e.g.• Cost: counting the number of primitives in each technology (e.g. tech 6, composed of 1 + 2 + 3, or 1 + (1 + 1 + 1 - 1) + (1 + 1 + 1) cost = 8)• Number of components• “Anti-targets:” specific unfeasible technologies
  13. 13. Contact• For further info, contact Janne M. Korhonen • janne.m.korhonen@aalto.fi, jmkorhonen.net• Or Julia Kasmire, • j.kasmire@tudelft.nl
  14. 14. Main references• Arthur, B.W., 2009. The Nature of Technology: What it is and how it evolves. Free Press, New York.• Arthur, W.B., Polak, W., 2006. The evolution of technology within a simple computer model. Complexity 11, 23-31.• Nelson, R. R. (2005). Perspectives on technological evolution. In K. Dopfer (Ed.), The Evolutionary Foundation of Economics (pp. 461-471). Cambridge: Cambridge University Press.• See paper for more!

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