The following HTML text is provided to enhance online
readability. Many aspects of typography translate only awkwardly to HTML.
Please use the page image
as the authoritative form to ensure accuracy.
changing tastes, variations in interest rates, changes in the strength of cartels, and variations in trade barriers—all these redefine comparative advantage. This redefinition is accommodated, at least in theory, by a shift in the specialization of people, tools, and land to different lines of production and by a new pattern of exchange. Economists assume that factors involved in production are mobile, i.e., labor, capital, and land can shift between lines of production in a way that optimizes benefit to all.
Other things being equal, these adjustments to exogenous change lead to economic well-being. With all producers adjusting to compensate for a change in the best possible way, the overall impact of the change is minimized. The adjustments keep aggregate well-being as close to the undisturbed maximum as possible and hence more stable than it would be if the adjustments did not take place. But this stabilizing process for humanity as a whole increases the amount of change for individuals in terms of who does what with which tools and land. Variation in aggregate economic welfare is reduced by increasing the variation for the individual components in the economic system.
The economic model is used for designing exchange policies based on the implicit assumption that land can move between uses much like people and tools. But environmental services cannot freely shift from the support of rice to the support of cotton, to suburban lawns, to concrete, to alfalfa, to marsh habitat for waterfowl, and back to rice much the same as a reasonably adaptive person might shift from being a farmer to an urban gardener, to a game warden, and back to being a farmer.
There are many similarities between economic and ecological models (Rapport and Turner, 1977). Economic models have people with different capabilities filling different niches much like different species fill different niches. But the two models differ dramatically with respect to how the systems are presumed to adjust to exogenous change. Biological species evolve to fill their niches. The recent shift from thinking of each species as having evolved individually in response to a changing physical environment to thinking that species coevolved has led to a new understanding of evolutionary dynamics (Lewin, 1986). The new emphasis also stresses how the coevolutionary process defines the niches themselves. Ecologists do not assume that predefined species sort themselves into predefined niches according to their comparative advantages, resulting in what is best for all given the exogenous influences at the time. The differences between economic and ecological understanding help explain why the global exchange economy has led to extinction.
May (1973) hypothesized that biological diversity is greater in the tropics than in the arctic because the climatic constancy facilitated the evolution of greater niche specialization. This conjecture matches theory with evidence very nicely and has considerable appeal. Climates with little variation lead to the coevolution of highly specialized, interdependent species dependent on particular conditions. Conversely, in a tropical rain forest ecosystem, a small change from the conditions in which species coevolved is more likely to lead to extinction than a change of comparable magnitude in an arctic tundra system. This explains why the tropical rain forests, with their great species diversity and the complex relationships among them, have proven so vulnerable to changes wrought by modern technologies.