Until the beginning of the XXth century for most people the items of consumption used in everyday life were very few, very simple and afforded little individuality. Starting from the beginning of the XXth century in selected societies, initially mostly in the USA, individual consumption began to diversify.

Both the causes of these phenomena and their implications for economics were considerable. For what concerns the causes, clearly innovation and technical change had played a fundamental role. Starting from the industrial revolution the growing efficiency of industrial processes had provided consumers with an abundant and cheap supply of basic consumer goods. The continuous cheapening of these goods led inevitably to a growing variety and to a growing sophistication of the goods consumed. New features were added to pre-existing goods and a growing specialization took place in their production and consumption. Economists observed these trends and started conceptualising phenomena such as product differentiation and monopolistic competition. In addition to this, the role of products, and especially of complex ones, at the interface between innovation and demand has further stimulated a considerable amount of research in economics and management focusing on the effect of demand on innovation. Several strands in the literature, both empirical and theoretical, ranging from the old debate demand pull vs. technology push, to the analysis of demand, market structure and innovation, imperfect information among consumers, user initiated innovation, user-producer interaction and value networks, are very relevant in this context. The presence of submarkets may also play a crucial role in affecting the growth and size distribution of firms within an industry. Demand has also been a key factor with respect to the emergence of disruptive technologies.

Yet, for all this flourishing of interest in the subject, most contributing scholars had to be content with a representation of complex products based on at most one index of product quality. Thus, phenomena such as the structural changes occurring within product characteristics as a consequence of the emergence of dominant designs, or the need foreseen by Schumpeter for producers to educate consumers, phenomena within which the shifting balance between supply and demand play a crucial role, could not be investigated. Unfortunately so far the very limited amount of data on demand and product characteristics has severely constrained the development of studies which are in principle possible in this area.

To compensate for this shortcoming, this workshop represent the first stage toward the construction of data base on product characteristics, henceforth called DBX, based on a an open source approach. Although a number of people used data of this type in particular studies, dispersion and lack of standardization prevented the accumulation and reduced the potential usefulness of the existing information.

With this workshop we propose to:

1. Identify and form a group of researchers interested in the quantitative analysis of demand and consumption;
2. Combine existing data on product and demand characteristics in a common data base (DBX) using a standardized format and based on an open source approach, in such a way that everyone who contributes a minimum amount of data becomes a DBX member and has access to the whole DBX;
3. Over time, increase the population of DBX members in order to extend the data base further to products not yet covered using the standardized format which will have been previously defined;
4. Centralize the storage, standardization and updating of DBX where the relevant human resources are available;
5. Use DBX as a vehicle for joint future projects, meetings and conferences;

Attendance:
This workshop is restricted to a small number of participants to discuss the various issues involved, start organizing the construction of DBX and plan future events. Several DIME members have accepted to deliver papers to the workshop. The construction of DBX constitutes the first step, to be followed by a conference in Milan at Bocconi University during November-December 2007 which will explore the role of demand in innovation and the theoretical implications of product characteristics for the analysis of the co-evolution of innovation and of demand.

Date and location:
The workshop will take place on April 26-27 2007 at Sophia Antipolis, near Nice.

Timetable:
Workshop announced March 13, 2007

Workshop organizers:
Pier Paolo Saviotti, GREDEG, France
Franco Malerba, CESPRI – Bocconi University, Italy