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Diversity And Economic Evolution: Failures Of Competitive Economic Systems

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  • CLEM TISDELL

Abstract

This paper has two themes. First, diversity of relevant attributes driving the dynamics of socioeconomic systems, including industrial systems'is often needed to increase their likelihood of transiting to a superior state. However, systems left to their own devices do not always evolve to states where they possess sufficient or optimal diversity for further evolution or growth to a superior state. Evolutionary market mechanisms can be of this nature. Structural adjustment policies and globalization seem to be adding to industrial and other types of uniformity. Hence, real danger exists that global industrial structures influenced by field effects will become “piled up” and reduce the likelihood of the global economic system evolving to a superior economic state. Furthermore, diversity is an important driving force in other growth processes, e.g., those adding to the stock of knowledge. Second industrial diversity of techniques and behaviors may be potentially Paretian valuable as a means of optimal adjustment to continual technological change and as a manifestation of specialization according to differences in individual abilities and in those of organizations. Insofar as attempts at benchmarking try to ensure uniform adoption of “best practice” in industry, they are likely to be doubly damaging because short‐run potential Paretian benefits are forgone, and in stifling industrial diversity they may also undermine industrial diversity as a source of future economic growth. (JEL D00, D89, O30, 014)

Suggested Citation

  • Clem Tisdell, 1999. "Diversity And Economic Evolution: Failures Of Competitive Economic Systems," Contemporary Economic Policy, Western Economic Association International, vol. 17(2), pages 156-165, April.
    • Handle: RePEc:bla:coecpo:v:17:y:1999:i:2:p:156-165
    DOI: 10.1111/j.1465-7287.1999.tb00671.x
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    Cited by:

    1. Agnieszka Lipieta & Elżbieta Pliś, 2022. "Diversity and mechanisms of economic evolution," Journal of Evolutionary Economics, Springer, vol. 32(4), pages 1265-1286, September.
    2. ., 2013. "Market niches, competition and economic performance: more clues from ecology?," Chapters, in: Competition, Diversity and Economic Performance, chapter 8, pages 160-182, Edward Elgar Publishing.
    3. Clem Tisdell, 2013. "Economics, ecology and GMOs: sustainability, precaution and related issues," Chapters, in: M. A. Quaddus & M. A.B. Siddique (ed.), Handbook of Sustainable Development Planning, chapter 5, pages 91-118, Edward Elgar Publishing.
    4. Tisdell, Clem & Seidl, Irmi, 2004. "Niches and economic competition: implications for economic efficiency, growth and diversity," Structural Change and Economic Dynamics, Elsevier, vol. 15(2), pages 119-135, June.
    5. ., 2013. "Competition, diversity, evolution and sustainability: are there lessons from ecology?," Chapters, in: Competition, Diversity and Economic Performance, chapter 7, pages 132-159, Edward Elgar Publishing.
    6. Tisdell, Clement A., 2000. "Globalisation, WTO and Sustainable Development," Economics, Ecology and Environment Working Papers 48009, University of Queensland, School of Economics.
    7. Jeroen van den Bergh & John Gowdy, 2000. "Evolutionary Theories in Environmental and Resource Economics: Approaches and Applications," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 17(1), pages 37-57, September.
    8. Tisdell, Clement A., 2001. "Competition, Evolution and Optimisation: Comparisons of Models in Economics and Ecology," Economics, Ecology and Environment Working Papers 48384, University of Queensland, School of Economics.
    9. Jacques-Marie Aurifeille & Serge Svizzero & Clement Allan Tisdell, 2006. "What Leading Economic and Managerial Issues are Covered? Why are they Important in the Context of Globalisation?," Post-Print hal-02155059, HAL.

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    More about this item

    JEL classification:

    • D00 - Microeconomics - - General - - - General
    • D89 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Other
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

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