Market liquidity theory evidence and policy pdf to jpg
Diffusion of innovations is a theory that seeks to explain how, why, and at what rate new ideas and technology spread. Everett Rogersa professor of communication studiespopularized the theory in his book Diffusion of Innovations ; the book was first published inand is now in its fifth edition The origins of the diffusion of innovations theory are varied and span multiple disciplines.
Rogers proposes that four main elements influence the spread of a new idea: This process relies heavily on human capital. The innovation must be widely adopted in order to self-sustain.
Within the rate of adoption, there is a point at which an innovation reaches critical mass. The categories of adopters are innovators, early adoptersearly majority, late majority, and laggards.
The criterion for the adopter categorization is innovativeness, defined as the degree to which an individual adopts a new idea. The concept of diffusion was first studied by the French sociologist Gabriel Tarde in late 19th century [3] and by German and Austrian anthropologists and geographers such as Friedrich Ratzel and Leo Frobenius.
Agriculture technology was advancing rapidly, and researchers started to examine how independent farmers were adopting hybrid seeds, equipment, and techniques. Earl Pemberton, [10] who provided examples of institutional diffusion [11] such as postage stamps and standardized school ethics codes.
InEverett Rogersa professor of rural sociology, published his seminal work: Rogers synthesized research from over diffusion studies across the fields that initially influenced the theory: Using his synthesis, Rogers produced a theory of the adoption of innovations among individuals and organizations. His methodologies are market liquidity theory evidence and policy pdf to jpg followed in recent diffusion research, even as the field has expanded into, and been influenced by, other methodological disciplines such as social network analysis and communication.
Studies have explored many characteristics of innovations. Meta-reviews have identified several characteristics that are common among most studies.
Potential adopters evaluate an innovation on its relative advantage the perceived efficiencies gained by the innovation relative to current tools market liquidity theory evidence and policy pdf to jpg proceduresits compatibility with the pre-existing system, its complexity or difficulty to learn, its trialability or testability, its potential for reinvention using the tool for initially unintended purposesand its observed effects. These qualities interact and are judged as a whole. For example, an innovation might be extremely complex, reducing its likelihood to be adopted and diffused, but it might be very compatible with a large advantage relative to current tools.
Even with this high learning curve, potential adopters might adopt the innovation anyway. Studies also identify other characteristics of innovations, but these are market liquidity theory evidence and policy pdf to jpg as common as the ones that Rogers lists above.
Specifically, innovations with a small market liquidity theory evidence and policy pdf to jpg and large periphery are easier to adopt. Likewise, innovations that make tasks easier are likely to be adopted.
Even when there are high knowledge requirements, support from prior adopters or other sources can increase the chances for adoption. Like innovations, adopters have been determined to have traits that affect their likelihood to adopt an innovation. A bevy of individual personality traits have been explored for their impacts on adoption, but with little agreement. Unsurprisingly, potential adopters who are motivated to adopt an innovation are likely to make the adjustments needed to adopt it.
Finally, potential adopters who have the power or agency to create change, particularly in organizations, are more likely to adopt an innovation than someone with less power over his choices. Organizations face more complex adoption possibilities because organizations are both the aggregate of its individuals and its own system with a set of procedures and norms.
Organizations can feel pressured by a tension for change. If the organization's situation is untenable, it will be motivated to adopt an innovation to change its fortunes. This tension often plays out among its individual members. Innovations that match the organization's pre-existing system require fewer coincidental changes and are easy to assess are more likely to be adopted. Where an innovation is diffusing through the organization's environment for any reason, the organization is more likely to adopt it.
Diffusion occurs through a five—step decision-making process. It occurs through a series of communication channels over a period of time among the members of a similar social system. Ryan and Gross first identified adoption as a process in An individual might reject an innovation at any time during or after the adoption process. Abrahamson examined this process critically by posing questions such as: How do technically inefficient innovations diffuse and what impedes technically efficient innovations from catching on?
Abrahamson makes suggestions for how organizational scientists can more comprehensively evaluate the spread of innovations. However, the descriptions of the categories have remained similar throughout the editions. Based on these considerations, three types of innovation-decisions have been identified. The rate of adoption is defined as the relative speed at which participants adopt an innovation.
Rate is usually measured by the length of time required for a certain percentage of the members of a social system to adopt an innovation. In general, individuals who first adopt an innovation require market liquidity theory evidence and policy pdf to jpg shorter adoption period adoption process when compared to late adopters.
Within the adoption curve at some point the innovation reaches critical mass. This is when the number of individual adopters ensures that the innovation is self-sustaining. Rogers outlines several strategies in order to help an innovation reach this stage, including when an innovation adopted by a highly respected individual within a social network and creating an instinctive desire for a specific innovation. Another strategy includes injecting an innovation into a group of individuals who would readily use said technology, as well as providing positive reactions and benefits for early adopters.
Adoption is an individual process detailing the series of stages one undergoes from first hearing about a product to finally adopting it. Diffusion signifies a group phenomenon, which suggests how an innovation spreads. Rogers defines an adopter category as a classification of individuals within a social system on the basis of innovativeness. In the book Diffusion of InnovationsRogers suggests a total of five categories of adopters in order to standardize the usage of adopter categories in diffusion research.
The adoption of an innovation follows an S curve when plotted over a length of time. Change agents bring innovations to new communities— first through the gatekeepers, then through the opinion leaders, and so on through the community.
Failed diffusion does not mean that the technology was adopted by no one. From a social networks perspective, market liquidity theory evidence and policy pdf to jpg failed diffusion might be widely adopted within certain clusters but fail to make an impact on more distantly related people. Networks that are over-connected might suffer from a rigidity that prevents the changes market liquidity theory evidence and policy pdf to jpg innovation might bring, as well.
For example, Rogers discussed a situation in Peru involving the implementation of boiling drinking water to improve health and wellness levels in the village of Los Molinas. The residents had no knowledge of the link between sanitation and illness. The campaign worked with the villagers to try to teach them to boil water, burn their garbage, install latrines and report cases of illness to local health agencies.
In Los Molinas, a stigma was linked to boiled water as something that only the "unwell" consumed, and thus, the idea of healthy residents boiling water prior to consumption was frowned upon.
The two-year educational campaign was considered to be largely unsuccessful. This market liquidity theory evidence and policy pdf to jpg exemplified the importance of the roles of the communication channels that are involved in such a campaign for social change. An examination of diffusion in El Salvador determined that there can market liquidity theory evidence and policy pdf to jpg more than one social network at play as innovations are communicated.
One network carries information and the other carries influence. While people might hear of an innovation's uses, in Rogers' Los Molinas sanitation case, a network of influence and status prevented adoption. Lazarsfeld and Merton first called attention to the principles of homophily and its opposite, heterophily. Using their definition, Rogers defines homophily as "the degree to which pairs market liquidity theory evidence and policy pdf to jpg individuals who interact are similar in certain attributes, such as beliefs, education, social status, and the like".
Homophilous individuals engage in more effective communication because their similarities lead to greater knowledge gain as market liquidity theory evidence and policy pdf to jpg as attitude or behavior change. As a result, homophilous people tend to promote diffusion among each other. Therefore, an ideal situation would involve potential adopters who are homophilous in every way, except in knowledge of the innovation.
Promotion of healthy behavior provides an example of the balance required of homophily and heterophily. People tend to be close to others of similar health status. This presents a critical challenge for health communications, as ties between heterophilous people are relatively weaker, harder to create, and harder to maintain. Once one previously homophilous tie adopts the behavior or innovation, the other members of that group are more likely to adopt it, too.
Not all individuals exert an equal amount of influence over others. In this sense opinion leaders are influential in spreading either positive or negative information about an innovation. Opinion leaders have the most influence during the evaluation stage of the innovation-decision process and on late adopters. Research was done in the early s at the University of Chicago attempting to assess the cost-effectiveness of broadcast advertising on the diffusion of new products and services.
The lowest levels were generally larger in numbers and tended to coincide with various demographic attributes that might be targeted by mass advertising. However, it found that direct word of mouth and example were far more influential than broadcast messages, which were only effective if they reinforced the direct influences. This led to the conclusion that advertising was best targeted, if possible, on those next in line to adopt, and not on those not yet reached by the chain of influence.
Research on actor-network theory ANT also identifies a significant overlap between the ANT concepts and the diffusion of innovation which examine the characteristics of innovation and its context among various interested parties within a social system to assemble a network or system which implements innovation.
Other research relating the concept to public choice theory finds that the hierarchy of influence for innovations need not, and likely does not, coincide with hierarchies of official, political, or economic status.
Prior to the introduction of the Internet, it was argued that social networks had a crucial role in the diffusion of innovation particularly tacit knowledge in the book The IRG Solution — hierarchical incompetence and how to overcome it. The social model proposed by Ryan and Gross [37] is expanded by Valente who uses social networks as a basis for adopter categorization instead of solely relying on the system-level analysis used by Ryan and Gross. Valente also looks at an individual's personal network, which is a different application than the organizational perspective espoused by many other scholars.
Recent research by Wear shows, that particularly in regional and rural areas, significantly more innovation takes place in communities which have stronger inter-personal networks.
Innovations are often adopted by organizations through two types of innovation-decisions: The collective decision occurs when adoption is by consensus. The authority decision occurs by adoption among very few individuals with high positions of power within an organization.
Within an organization certain individuals are termed "champions" who stand behind market liquidity theory evidence and policy pdf to jpg innovation and break through opposition. The champion plays a very similar role as the champion used within the efficiency business model Six Sigma.
The process contains five stages that are slightly similar to the innovation-decision process that individuals undertake. Diffusion of Innovations has been applied beyond its original domains.
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