As will be discussed, an analysis of the typical individual adaptation strategies to capitalist crises can offer a clue for understanding what obstacles to growth have occurred and what can be done to extend possible limits of capitalist growth. The interesting point therefore is how the results of individual adaptation efforts may have changed so that declining growth rates result at the national level. From a complex adaptive systems point of view, an industry’s contribution to national economic growth is the collective outcome of the efforts at the individual level to adapt to a critically changing environment. It was raised as a consequence of observing secularly declining growth rates in the most developed economies since the 1970s (Durlauf et al. In contrast, the question of whether economic growth will prevail has only more recently gained increasing attention. The unsteadiness of capitalist development is a longstanding theme of economic theorizing from Marx ( 1867) to Schumpeter ( 1934) to Keynes ( 1937). Can a high-rate growth be resumed or is capitalist growth leveling off? Once such a turn has been made, an important problem that appears on the screen is whether and how new economic growth can re-emerge after each crisis. Taking such a perspective on economic growth therefore requires turning away from the equilibrium theories of balanced growth (starting with Solow 1956) as well as the more recent endogenous growth theories à la Aghion and Howitt ( 1998).
As will be discussed, a complex adaptive systems perspective suggests that the process by which the bounds of the existing production opportunities are successively expanded in capitalism is unsteady and rather wasteful. A case in point is the way in which economic growth emerges as a collective outcome of individual adaptation strategies. Except for its particular mode of production many of its features are typical for complex adaptive systems. In this paper it will be argued that capitalism is a complex adaptive system. To the contrary, there are cases in which complex adaptive systems mal-adapt as a whole (Wilson 2016). This multi-level adaptation process is neither certain to be a smooth one nor to be necessarily successful in the sense of improvement, progress, or growth.
The adaptation of the system as a whole is the collective outcome of the adaptation efforts of all its individual agents. At both levels, the level of the individual agents and the level of the system as a whole, viability is contingent on a proper adaptation to the environment. The paper discusses what can be conjectured to be the cause of this development and what to do about it.Ĭomplex adaptive systems consist of a multitude of agents from whose individual adaptation efforts the adaptive behavior of the system as a whole emerges. This seems to suggest that successfully creating new economic growth through innovative strategies is the more difficult, the more prosperous an economy becomes. It is shown that the empirical record of economic growth in the most developed economies indeed reveals a trend of declining growth rates. Moreover, the strategies by which the agents try to adapt to crises – many of which imply some form of innovations – do not necessarily contribute to a re-emergence of new growth impulses. The complex adaptive systems perspective offers a particular explanation for why the successive extension of the bounds of existing production possibilities is unsteady and rather wasteful in capitalism. Except for its particular mode of production many of its features are typical for such a system. Complex adaptive systems consist of a multitude of agents from whose individual adaptation efforts the adaptive behavior of the system as a whole emerges.
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