What is an evolutionary economy?

The

evolutionary economy is an economic theory that draws on evolutionary biology and appears at the beginning of the 80s in the book "Evolutionary Theory of Economic Change" by Richard R. Nelson and Sidney G. Winter. Although the area of ​​evolutionary economy has only developed relatively recently, important economists such as Joseph Schumpeter, Herbert Simon and Edith Penrose have built the basis for the evolutionary economy during the 40s and 50 years. Evolutionary economy essentially explains economic phenomena through evolutionary methodology.

The evolutionary economy claims that markets are selection facilities in the modern economy. Companies and corporations are selected on the basis of their productivity and revenue levels. Low productivity companies will therefore be permanently defeated and loses market share, which selectively displace the company from the market. On the other hand, high productivity companies will gain a higher market share in growth. This is a natural selection that claims to survive a strong.

Another aspect of evolutionary biology that has been adapted to the evolutionary economy is the concept that the characteristics beneficial to the body will become more frequent in the population. The theory of evolutionary economy has developed this idea, which also applies to companies on the market. Less successful companies will try to copy routines - equivalent features in the theory of evolution - more successful companies that will compete. Thus, the most successful routines become more common on the market, as low productivity companies try to increase productivity by imitating high productivity companies.

Evolutionary biology also states that mutations occur in the species gene fund and the most advantageous mutations are incorporated into the entire population. In evolutiononomics, the equivalent of this idea is the concept of companies looking for innovations. Innovation involves bringing new routines to the market, an equivalent of a mutation that brings a new feature of the population. Successful new routines begin to imitate less successful companies, cOJ will increase the presence of routine on the market.

The

evolutionary economy was applied to the areas of industrial organization, theory of organization, economic geography, game theory, innovation management, network theory and management science. This is primarily the result of the basic concept of the evolutionary economy. This concept has that companies have to use routines that are competitive and cannot be replicated by other companies to be successful.