Market dimensionality and the proliferation of small-scale firms

César García-Díaz*, Arjen Van Witteloostuijn, Gábor Péli

*Corresponding author for this work

Research output: Contribution to JournalArticleAcademicpeer-review


We build an agent-based computational model to study how the changing number of active product variants in a two-dimensional product space affects the performance of different firm types (i.e. large-scale and small-scale enterprises). We use an alternative approach to measure product space dimensionality, considering that dimensions may be a fraction of the Euclidean measure. The results confirm that high dimensionality gives advantage to small-scale firms. Additionally, we find that large-scale firms may also benefit from initial increasing dimensionality, since it allows a small degree of product differentiation and price discrimination.

Original languageEnglish
Pages (from-to)231-247
Number of pages17
Issue number2
Publication statusPublished - 1 Jan 2008
Externally publishedYes


  • Agent-based modeling
  • Market dimensionality
  • Market evolution

Fingerprint Dive into the research topics of 'Market dimensionality and the proliferation of small-scale firms'. Together they form a unique fingerprint.

Cite this