Connecting adaptive behaviour and expectations in models of innovation: The Potential Role of Artificial Neural Networks

Abstract

In this methodological work I explore the possibility of explicitly modelling expectations conditioning the R&D decisions of firms. In order to isolate this problem from the controversies of cognitive science , I propose a black box strategy through the concept of "internal model". The last part of the article uses artificial neural networks to model the expectations of firms in a model of industry dynamics based on Nelson & Winter (1982).