Dynamic Industry Evolution Model on Product Life Cycle

AbstractThis model is based on the Steven Klepper(1996)’s contribution to the Product Life Cycle(PLC) theory. We construct the specific functions of the original model, further design a mechanism for the competition and simulate to coincide with the past regularities about PLC. The model also aims at revealing effect of the parameters to the industry evolution process. It confirms the original model, and exposes the entry, exit, innovation, competitive behaviors in the industry. This model has a generous structure with discrete periods that can be applied to specific industry. It also can be used to analyze and forecast the competition pattern in the energy industry