Competition, Diversity and Economic Performance

Competition, Diversity and Economic Performance

Processes, Complexities and Ecological Similarities

Clement A. Tisdell

This thought-provoking book explores the influences of market competition and diverse behaviours of economic agents on economic performance, particularly dynamic economic performance.

Chapter 7: Competition, diversity, evolution and sustainability: are there lessons from ecology?

Clement A. Tisdell

Subjects: economics and finance, evolutionary economics, industrial economics, environment, ecological economics

Extract

After discussing generally models in ecology and economics that combine competition, optimization and evolution, this chapter concentrates on models of intraspecific competition. It demonstrates the importance of diversity or inequalities within populations of species and in their environments for the sustainability of species, given the occurrence of environmental change. This is demonstrated both for scramble (open- access) and contest competition. Implications are drawn for human populations and for industrial organization. Then the changing nature of competition is considered between firms in new industries as these industries develop. Policy implications of the analysis are outlined. For example, it is argued that policies designed to encourage intense business competition and maximize economic efficiency have the drawback of eventually making industries highly vulnerable to exogenous economic changes.

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