Developing agent-based models of business relations and networks

Business relations and networks play a central role in the way business and economic systems are organized and function. But their dynamics and evolution have received limited research attention, with research focusing on comparative static and crosssection surveys. In order to develop appropriate research-based management and policy advice, we need a better understanding of how business relations and networks form and evolve. One way to do this is through the development of agent-based simulation models of business relations and networks that allow researchers to explore systematically the nature and impact of various factors on the structure, behaviour and performance that are beyond traditional closed-form mathematical solutions and that would be impossible to implement in the field. We identify the main mechanisms driving the evolution of business relations and networks and review models from various disciplines that attempt to represent these. This provides the basis for developing a generic simulation platform called the Business Network Agent-Based Modelling System (BNAS).