Micro-Cultural Preferences and Macro-Percolation of New Ideas: A NetLogo Simulation
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This paper provides an extension of the Schelling agent-based model (ABM) of segregation which is augmented here with a mechanism for the percolation of new ideas. The main objective of the paper is to demonstrate that individual segregation preferences affect not only the intensity of aggregate segregation, but also the aggregate efficiency from crucial decision-making processes, such as the decision to invest in new ideas. To perform our research, we implement a NetLogo simulation in two steps by (i) obtaining three sets, each composed of 500 random segregation patterns, generated through a one-step simulation of a Schelling ABM for three different levels of segregation preference: namely, 20, 25 and 30%; and (ii) using the obtained level of segregation, we set the porosity level in a model for the percolation of new ideas and record the observed speed of percolation of new ideas for the first 100 steps. We find that levels of segregation due to 20 and 25% individual preference for homophily produce a difference of 3.4% in their effect on the speed of the percolation of new ideas. The levels of segregation of 25 and 30% individual preference for homophily, however, produce a difference of 12.8% in their effect on the percolation of new ideas. This means that the increase of the individual preference for segregation increases the intensity with which segregation acts as a barrier for new ideas to percolate successfully in the world of R&D investment. The segregation-percolation model used can be extended with further dynamics and developed as a code to be added to the NetLogo library. The main implication of our findings is that small changes in segregation preferences as in the Schelling ABM model produces increasingly negative on aggregate level spillover effects on other socio-economic processes, such as percolation of new ideas, which depend on the connectivity between people in the local society.
KeywordsSegregation Percolation Cultural preferences Ideas R&D investment
JEL ClassificationsZ10 C79 C99 L26 R11
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