The ecological model of competition is a reassessment of the nature of

competition Competition is a rivalry where two or more parties strive for a common goal which cannot be shared: where one's gain is the other's loss (an example of which is a zero-sum game). Competition can arise between entities such as organisms, indi ...

in the

economy An economy is an area of the Production (economics), production, Distribution (economics), distribution and trade, as well as Consumption (economics), consumption of Goods (economics), goods and Service (economics), services. In general, it is ...

. Traditional

economics Economics () is a behavioral science that studies the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods and services. Economics focuses on the behaviour and interac ...

models the economy on the principles of

physics Physics is the scientific study of matter, its Elementary particle, fundamental constituents, its motion and behavior through space and time, and the related entities of energy and force. "Physical science is that department of knowledge whi ...

(force, equilibrium, inertia, momentum, and linear relationships). This can be seen in the economics lexicon: terms like

labour force In macroeconomics, the workforce or labour force is the sum of people either working (i.e., the employed) or looking for work (i.e., the unemployed): \text = \text + \text Those neither working in the marketplace nor looking for work are out ...

, market equilibrium, capital flows, and price elasticity. This is probably due to historical coincidence. Classical

Newtonian physics Classical mechanics is a physical theory describing the motion of objects such as projectiles, parts of machinery, spacecraft, planets, stars, and galaxies. The development of classical mechanics involved substantial change in the methods ...

was the state of the art in science when

Adam Smith Adam Smith (baptised 1723 – 17 July 1790) was a Scottish economist and philosopher who was a pioneer in the field of political economy and key figure during the Scottish Enlightenment. Seen by some as the "father of economics"——— or ...

was formulating the first principles of economics in the 18th century. According to the ecological model, it is more appropriate to model the economy on

biology Biology is the scientific study of life and living organisms. It is a broad natural science that encompasses a wide range of fields and unifying principles that explain the structure, function, growth, History of life, origin, evolution, and ...

(growth, change, death, evolution,

survival of the fittest "Survival of the fittest" is a phrase that originated from Darwinian evolutionary theory as a way of describing the mechanism of natural selection. The biological concept of fitness is defined as reproductive success. In Darwinian terms, th ...

, complex inter-relationships, non-linear relationships). Businesses operate in a complex environment with interlinked sets of determinants. Companies co-evolve: they influence, and are influenced by, competitors,

customer In sales, commerce, and economics, a customer (sometimes known as a Client (business), client, buyer, or purchaser) is the recipient of a Good (economics), good, service (economics), service, product (business), product, or an Intellectual prop ...

s, governments, investors, suppliers, unions, distributors, banks, and others. We should look at this business environment as a business ecosystem that both sustains, and threatens the firm. A company that is not well matched to its environment might not survive. Companies that are able to develop a successful

business model A business model describes how a Company, business organization creates, delivers, and captures value creation, value,''Business Model Generation'', Alexander Osterwalder, Yves Pigneur, Alan Smith, and 470 practitioners from 45 countries, self-pub ...

and turn a

core competency A core competency is a concept in management theory introduced by C. K. Prahalad and Gary Hamel.Prahalad, C.K. and Hamel, G. (1990)The core competence of the corporation", Harvard Business Review (v. 68, no. 3) pp. 79–91. It can be define ...

into a sustainable competitive advantage will thrive and grow. Very successful firms may come to dominate their industry (referred to as ''category killers'').

References

* Moore, James (1993) "Predators and Prey : A new ecology of competition", ''Harvard Business Review'', May/June 1993. {{DEFAULTSORT:Ecological Model Of Competition Economics models Competition

See also

References