Home  Journals  Financial Analytics: Science and Experience  34(220) - 2014 September

Economic and mathematical modeling of dynamics of change of generations of telecommunications services

Available online: 1 September 2014

Subject Heading: MATHEMATICAL METHODS OF ANALYSIS

JEL Classification: 

Pages: 43-55

The article points out that while predicting and analyzing the financial performance of an enterprise it is very important to understand and take into account the size of the market, the potential demand and the proximity of an industry to saturation. The paper proposes an approach within the framework of which we can define the carrying capacity of the market, subject to the existence of two technologies, one of which is gradually replacing another one. As the subject of the study,we have selected the dynamics of the market data transfer that is studied using the methods of economic-mathematical modeling of diffusion of innovation. The transition from the dial-up access to Internet to the broadband access takes place within the competitive interaction between two consecutive generations of technology, since it can be described by the mathematical Gilpin -Ayala model of dynamics of interaction of two biological populations. The objectives of the paper are to confirm the hypothesis that given model can be used to describe the process of change of technologies and the formation of the forecast on the prospects of the development of the broadband access to Internet. To determine the coefficients of the model, the authors built an econometric model, described by the system of simultaneous equations, as well as made the comparison of the Gilpin-Ayala model with the more popular and widely used Trays-Volterra model. The research has shown that Gilpin-Ayala model better describes the process of diffusion of innovations of the data transfer market. In addition, the quality of the resulting prediction was rather high. The authors emphasize that as the result of the simulation it was found that the market for broadband distribution is close to saturation, so in order to ensure the sustainable financial performance of the service-providers, the search of new directions of activity, in particular, the promotion of mobile Internet technologies come to the fore.

Keywords: economic growth, scientific and technological progress, innovation diffusion mechanisms, mathematical mode, Gilpin-Ayala model, econometric model

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