Peer effects in innovation adoption decisions have been extensively studied. However, the underlying mechanisms of peer effects are generally not explicitly accounted for. Gaps in this knowledge could lead to misestimation of peer effects and inefficient interventions. This study examined the role of two mechanisms—sharing experiences (namely, experience effect) and externalities—in the adoption of an agricultural innovation. By referring to the diffusion process of a new crop in Chinese villages, we developed a simulation model that incorpor...
