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

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.

Smart Manufacturing for Smart Cities—Overview, Insights, and Future Directions

“…Fraccascia [125] analyzed the effect of online platforms on the emergence of IS relationships, utilizing an agent-based modeling approach, and concluded that exceeding a certain participant threshold has a significant effect on the individual network participants. Lu et al [111] developed an analytical model to evaluate the economic and ecological effects of urban IS on the metabolism of a city.…”

A holistic technological eco-innovation methodology for industrial symbiosis development

“…Lack of information sharing. Confidentiality reasons and technological issues limit the sharing of information through the network, affecting the IS performance ( Fraccascia, 2020 ) and emergence ( Fraccascia & Yazan, 2018 ). 3.…”

“…ICT tools, mainly oriented to IS identification or IS assessment, have been developed to facilitate the design and implementation of IS. Information and communication technology (ICT) tools based on IS identification usually cover three areas ( Grant et al, 2010 ) However, economic feasibility depends on the entire network ( Castiglione & Alfieri, 2019, 2020, available technologies ( Desrochers, 2004 ), and commitment and power of partners ( Hein et al, 2017 ), among others. It is often difficult for companies to have a realistic idea of economic feasibility, which is one of the main drivers of IS emergence, a priori ( Mortensen & Kørnøv, 2019 ).…”

Decision-Support Tools for Smart Transition to Circular Economy

“…The impact of the mismatch between waste demand and supply, due to the fluctuations in the amounts of wastes produced and required, was investigated by . From the technological perspective, the extent to which online platforms for IS can support companies to find symbiotic partners, thanks to sharing information (e.g., the location of companies, the amounts of waste demanded and potentially supplied) among the platform users, is assessed by Fraccascia and Yazan (2018) and Fraccascia (2020). From the policy perspective, the effect of two measuresi.e., higher landfill taxes for industrial wastes and economic subsidies to companies operating ISon the emergence of ISNs was investigated by Fraccascia, Giannoccaro, and Albino (2017).…”