On the Evolution of Product Portfolio of Cooperatives versus IOFs: An Agent-Based Analysis of the Single Origin Constraint

Abstract

An agent-based model is developed to address the relationship between the ownership structure of an \nenterprise and the evolution of its product portfolio. The coherence and evolution of a product \nportfolio is operationalized by transition rules regarding the Moore environment. The distinguishing \nfeature of a cooperative is the single origin constraint according to Cook (1997), which is modelled \nas a cooperative assigning an infinite lifetime to the first product in its product portfolio, while all \nother products have finite lifetime. All product of an investor-owned firm (IOF) are assumed to have \nfinite lifetime. Our simulation results show that the single origin constraint pulls the activities of the \ncooperative in one cluster centered around the first activity, while the IOF\xe2\x80\x99s product portfolio \ndevelops in a centrifugal way. The cooperative and the IOF are more diversified in a mixed duopoly