Elucidating Strategic Network Dynamics Through Computational Modeling

In this study we describe a comprehensive computational model of network dynamics (COM-NeD) and demonstrate how it may help us better understand and theorize the dynamics of strategic networks. Specifically, we model a population of firms characterized by idiosyncratic resource needs and productive capacities, while having to respond to the demands of external events by establishing ties and receiving needed resources from other firms. Through COM-NeD we investigate a set of established theoretical perspectives that represent distinct strategies for seeking and establishing interfirm ties. Rigorous computational experiments demonstrate the expected behavior of such a system under a broad range of assumptions. The results shed light on the complexity of strategic network dynamics, demonstrating novel interactions of firms' internal resource capacity, relational search approaches, and external resource growth.