Nina Schwarz EMAEE 2007 CONFERENCE Agent-Based Modelling of the Diffusion of Environmental Innovations An Empirical Approach

Page 2 OUTLINE Introduction Empirical data Agent-based model Concept Results Conclusions

Page 3 INTRODUCTION Empirical findings of previous studies Four components Agents: Innovativeness Interaction: Communication Innovations: Innovation characteristics Decision making: Bounded Rationality

Page 4 INTRODUCTION Existing Models on Environmental Innovations Main criticism Individuals either equal or artificial differences Innovations: abstract commodities Often neoclassical utility maximisation

Page 5 EMPIRICAL STUDY Overview Approaches Diffusion research (innovation characteristics) Social psychology (Theory of Planned Behavior, Ajzen, 1991) Sociology (lifestyles Sinus-Milieus) Decision research (Bounded rationality) Application: water-use innovations Water-saving shower head Rainharvesting system Dual-flush toilet Hydromassage shower Standardised, written questionnaire (N=272) Telephone interviews (N=12) Both conducted in Southern Germany

Page % Higher Middle Lower Social Status Basic Values A Traditionals C Leading Edge B Mainstream ® Sinus Sociovision 2006 GDR- Nostal- gia Consumption-Materialists 11% Conser- vatives 5% Establisheds 10% Modern Performers 9% Ground Breakers 8% Pleasure Seekers 11% Hedonistic Mainstream Modern Mainstream 16% Postmaterialists Social Leaders Postmaterialists 10% Traditionals 14% EMPIRICAL STUDY Sinus-Milieus ®

Page 7 EMPIRICAL STUDY Main findings Agents: Differences in lifestyles regarding Adoption of water-use innovations Amount of relevant innovation characteristics Relevance of social norm Interaction: Communication of minor importance Innovations: Five innovation characteristics important Environmental performance Ease of use Saving of costs Compatibility with existing infrastructure Investment costs Decision making: algorithms with different complexity

Page 8 AGENT-BASED MODEL Concept Area

Page 9 AGENT-BASED MODEL Concept Agents One type of household Postmaterialists Social Leaders Traditionals Mainstream Hedonists On a 1km² 11,915 agents in total Artificial social network Technologies Shower head Standard Water-saving Toilet flush Direct flush Standard Stopp button Dual flush Rainharvesting Yes No

Page 10 AGENT-BASED MODEL Decision making Agent type? Postmaterialist, Social Leaders Deliberate decision Innovation? Traditional, Mainstream, Hedonistic Heuristic [imitation incl.] else if rainharvesting system Overview

Page 11 AGENT-BASED MODEL Decision making Are there other relevant factors? no yes Check if one of technologies is better – according to evaluated criterion – than all competing technologies Loop, starting with most important criterion Choose all relevant criteria (relevant = importance > 0) Determine sequence of criteria, starting with the most important factor no decision no decision yes Take the Best-Heuristic See Gigerenzer et al., 1999

Page 12 AGENT-BASED MODEL Decision making i: property of agents j: property of innovation n: agents in network Deliberate decision

Page 13 AGENT-BASED MODEL Calibration Direct calibration Empirical data are directly integrated into the model Example: importance of social issues for agents Post- materialist Social Leaders Tradi- tional Main- stream Hedo- nistic Structural equation models n.s. 0.3*** - Regression n.s.0.2*0.3 *** n.s. Model

Page 14 AGENT-BASED MODEL Validation I Example: Dual flush toilets in 2005 Up to 16.5% % More than 17.5%

Page 15 AGENT-BASED MODEL Validation II Comparison to overall statistical data Example: Toilet tanks

Page 16 AGENT-BASED MODEL Scenarios I Example: Dual flush toilet

Page 17 AGENT-BASED MODEL Scenarios II Business as usual Diffusion even without further promotion Promotion strategies Dual flush: information speeds up diffusion due to more adopters among Traditional agents Other innovations (results not shown here): Different impact of strategies Different agent types as target groups

Page 18 CONCLUSIONS … for diffusion of water-use innovations Diffusion even without further promotion Promotion strategies for speeding up diffusion: specific for innovations and lifestyles … regarding methodology Linking of empirical research and agent-based modelling is feasible Other decision algorithms than utility maximisation can be integrated even in a large-scale simulation model

Page 19 Thank you for your attention!