Quantifying the direct network effect for online platforms supporting industrial symbiosis: an agent-based simulation study

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Abstract

This paper explores the direct network effect for online platforms supporting industrial symbiosis (IS), which is a recommended strategy to support the transition towards the circular economy. Through IS, companies can use wastes produced by other companies as inputs to production processes. Online platforms supporting companies in operating IS relationships can play a critical role in developing the IS practice. In this paper, an agent-based model is designed to simulate the emergence of IS relationships among companies located in a given geographical area. Companies can establish relationships traditionally (relying on face-to-face contacts) or by using a platform. Several scenarios, defined by different platform usage rates, are simulated. Results show that there is a minimum platform usage rate allowing companies to benefit from using the platform. If the platform usage rate is lower than this threshold, the platform does not contribute to generate further benefits for companies. When the platform usage rate is higher than the threshold, the individual benefits for users are higher the greater the number of other companies using the platform. Based on these results, implications on how to ensure a win-win approach for companies and platform owners can be provided, as well as implications for policymakers.
Original languageEnglish
Article number106587
Number of pages12
JournalEcological economics
Volume170
DOIs
Publication statusPublished - Apr 2020

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