I've been thinking about the differences between our economic system and a natural ecology. Since I'm not an expert in either I'm writing this in the hope that someone who is will clarify any issues I get wrong.
It seems to me that a fundamental difference is that natural ecologies are supply-driven. By that I mean that the supply of resources (food, sunshine, etc.) is the primary determinant of how the ecology functions. (I'm not talking here about transitions when a species invades an ecology and upsets the pre-existing balance. I want to focus at least at the beginning on ecologies that have achieved a fairly stable state.) In such ecologies fairly well-defined food webs are established. These determine the sizes of the various populations, etc. Of course there are or can be cycles such as the standard predator-prey cycle. But even in these cases, the whole thing is supply driven. It's what's available (primarily to be eaten) that determines everything else. Our economic system is for the most part supply-driven. The economy is not completely detached from the need for basic energy and other natural resource supplies. If there are supply shocks in these areas, the economy will feel them. But for the most part what most people do (as economic agents) depends on whether someone is willing to pay them. That means that most people are dependent on the demand (for their services) rather than the supply (of available food). Our current economic situation illustrates that very well. We are currently demand-deficient. Not enough people want to buy enough things (or services) to keep us all employed. This seems very strange and artificial. That so much of the economy depends on demand rather than supply makes it very vulnerable to the kind of problems we face today. But as I said, our economy is not completely demand driven. We are still supply dependent. Working with others I'm hoping to build a model that illustrates where the tipping point is. When does a supply-driven ecology become a demand-dependent economy? Is it a sharp phase transition? Can it be characterized in terms of other properties? Comments are welcome. -- Russ Abbott ______________________________________ Professor, Computer Science California State University, Los Angeles Google voice: 424-242-USA0 (last character is zero) blog: http://russabbott.blogspot.com/ vita: http://sites.google.com/site/russabbott/ ______________________________________
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