Chapter 25 Agent-based Models of Innovation and Technological Change

This chapter discusses the potential of the agent-based computational economics approach for the analysis of processes of innovation and technological change. It is argued that, on the one hand, several genuine properties of innovation processes make the possibilities offered by agent-based modelling particularly appealing in this field, and that, on the other hand, agent-based models have been quite successful in explaining sets of empirical stylized facts, which are not well accounted for by existing representative-agent equilibrium models. An extensive survey of agent-based computational research dealing with issues of innovation and technological change is given and the contribution of these studies is discussed. Furthermore a few pointers towards potential directions of future research are given.