Simulation-based Influence of Aspiration Models on Firms' Behavior



Year of publication 2017
Type Article in Proceedings
Conference Proceedings of the International Scientific Conference of Business Economics, Management and Marketing ISCOBEMM 2017
MU Faculty or unit

Faculty of Economics and Administration

Field Management and administrative
Keywords aspiration models; firm behavior; simulation-based testing
Description According to the behavioral theory of the firm, the performance feedback process is one of the key factors influencing firms’ decisions on strategies and their changes. The research contained in this paper compares the influence of four classical aspiration models (historical, social, mixed and switching) on firms’ strategy choices. Using NetLogo simulation software, a simple model of firms’ behavior is constructed and used to analyse these effects. The role of the social aspiration model is highlighted as it partially differs from the other aspiration models analysed. This indicates the need to focus attention on a firm’s reference group of competitors. In general, the paper advocates the use of simulation for behavioral research as a useful, though supplementary, tool for researchers.
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