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Ecosystem - Risk Article: Difference between revisions
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=====Problems===== | =====Problems===== | ||
Of course, neither model completely reflects reality. | Of course, neither model completely reflects reality. For one thing, {{risk|market}} conditions (the levelness of the playing field; availability of information) and prevalent {{risk|cooperation}} strategies amongst participants are interdependent. Adam Smith’s conditions for a benign market are not stable: no equilibrium will ever form there, because we are social, hoarding animals. | ||
*'''{{risk|Information}}''' | *'''{{risk|Information}}''' | ||
**''Information is inherently valuable''': Information is ''not'' universal, immediate, or homogeneous. Much of commerce would fail if it were. ''Therefore'' those who have information first have a distinct advantage over those who do not. | **''Information is inherently valuable''': Information is ''not'' universal, immediate, or homogeneous. Much of commerce would fail if it were. ''Therefore'' those who have information first have a distinct advantage over those who do not. | ||
**''Therefore it is economically rational to hoard information''. This tends to make it less likely that information will be free, a key assumption of the {{risk|Benign}} model. | **''Therefore it is economically rational to hoard information''. This tends to make it less likely that information will be free, a key assumption of the {{risk|Benign}} model. | ||
*'''{{risk|Cooperation}}''' | *'''{{risk|Cooperation}}''' | ||
*''We do cooperate''' In the right conditions individuals form natural alliances to share and protect valuable assets (like information). | *''We do cooperate''' In the right conditions individuals form natural alliances to share and protect valuable assets (like information). | ||
*''Cooperation brings economy of scale and natural advantage: Cooperation rigs the {{risk|market}} in favour of the cooperators against the unaffiliated, thus taking the market further from the {{risk|benign}} ideal. This is not, intrinsically, a bad thing. It is rational, logical and sensible behaviour. Nepotism is an instance of this kind of cooperation: it relies on a structure of trust. It is better viewed as a defensive strategy to ensure those we deal with we can trust, than an offensive strategy to keep strangers out. | *''Cooperation brings economy of scale and natural advantage: Cooperation rigs the {{risk|market}} in favour of the cooperators against the unaffiliated, thus taking the market further from the {{risk|benign}} ideal. This is not, intrinsically, a bad thing. It is rational, logical and sensible behaviour. Nepotism is an instance of this kind of cooperation: it relies on a structure of trust. It is better viewed as a defensive strategy to ensure those we deal with we can trust, than an offensive strategy to keep strangers out. | ||
*Cooperation ''changes'' the {{risk|market}}: where there were ten equal players, now there are nine: Eight equal small ones, and a bigger one. | *Cooperation ''changes'' the {{risk|market}}: where there were ten equal players, now there are nine: Eight equal small ones, and a bigger one. | ||