A Model for Growth of Markets of Products or Services Having Hierarchical Dependence

Choujun Zhan, Chi Kong Tse

Research output: Journal article publicationJournal articleAcademic researchpeer-review

4 Citations (Scopus)


Many products and services can only achieve their intended functions and performance when being used in conjunction with or under the operation of other products and services. Such products and services, having varying degrees of hierarchical dependence, are becoming dominant in the global market. This trend has intensified as a result of the rapid growth in the use of networked technology, and is particularly visible in computer and Internet related products and services. The growth of the user population is a result of collective decision behavior of users and prospective users as well as the hierarchical dependence of the streams of products or services. Based on construction of a networked community and two fundamental decision-making behaviors, we derive a model in the form of ordinary differential equations that describe the growth of the user population of such hierarchically-dependent markets. Then, we use this model to examine real-life data. Results show that all these data follow our growth equation, and the numerical algorithm for estimating the model parameters allows important market information hidden in the data to be unveiled, such as the relative effectiveness of customer service and promotional efforts, spending power of users, effective market size, and market growth rate.

Original languageEnglish
JournalIEEE Transactions on Network Science and Engineering
Publication statusAccepted/In press - 22 Feb 2018


  • Androids
  • Data models
  • dynamic model
  • Games
  • Humanoid robots
  • Markets
  • Mathematical model
  • social networks
  • Sociology
  • Statistics
  • user growth

ASJC Scopus subject areas

  • Control and Systems Engineering
  • Computer Science Applications
  • Computer Networks and Communications

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