Evolutionary Economics Economic Growth Model

Evolutionary Economics is an approach that emphasizes that economic processes and systems exist within a continuous <change> and <evolution>. According to this perspective, economic systems and markets are not static or in equilibrium but evolve in a dynamic manner. The growth model of this theory, unlike traditional economic understanding, focuses on change, innovation, and adaptation processes. Evolutionary Economics integrates the Darwinian theory of evolution with economics. According to this model, economic growth is not explained by capital accumulation or labor force increases but by innovations, learning processes, and adaptive capabilities. Evolutionary Economics links economic growth to open-ended processes and continuous change <long> and <adaptation>.

Technological Innovation and Adaptation

The evolutionary model of economics ties economic growth to technological innovations and adaptive capacity. Economic actors, particularly firms and entrepreneurs, must continuously create innovations and adapt to environmental changes. These innovations typically emerge around technological advances and new business models.

• Innovation and adaptation enable the system to develop through an evolutionary process.
• Innovative firms continuously step outside the existing process to generate innovations, yet they are also pressured by competitive forces.

Innovation and Selection Process

Evolutionary economics explains economic growth through competitive selection and innovation processes. In this context, firms and organizations in the market are gradually displaced by innovative firms with greater growth potential. This is a process analogous to Darwin’s principle of “natural selection”.

• Innovation: Firms must innovate to survive and grow in the market. Innovations can occur not only in products but also in processes, methods of work, and organizational structures.
• Selection: Innovative firms leave behind those that fail over the long term. This process fosters the competitive pressure and selection mechanism necessary for growth.

Systemic Change and Evolutionary Adaptation

Evolutionary economics explains economic growth not merely through individual actors but through the evolution of systemic structures. Markets and sectors undergo systemic changes over time, reflecting the continuous transformation of ways of working and industrial structures.

• The economic system develops and changes through internal interactions.
• Adaptation: Firms and sectors grow by adapting to environmental changes. Economic growth depends on the success of this adaptation process.

Growth and Transformation Processes

In evolutionary economics, growth is a reflection of continuous transformation and innovation processes. These processes are uninterrupted, and every change within the system opens the door to new opportunities while transforming existing structures <road>.

• Growth occurs not merely through input increases but through continuous innovation and structural transformation.
• Innovative processes lead to the emergence of new sectors and industries, while older sectors decline.

Growth Model and Exogenous Factors

Evolutionary economics acknowledges that exogenous factors (social, political, cultural) generate <important> impacts on economic growth. These external factors can influence innovation processes and adaptive capacity.

• Elements such as political stability, education, and social norms affect the evolutionary process of economic growth.
• Institutional structures: The structure and functioning of institutions also play a crucial role in the evolution of the economic system.

Growth and Changing Structures

Evolutionary economic growth is also associated with structural changes. An economy does not merely grow; it undergoes structural transformation. For example, an economy may transition from an agriculture-based structure toward industry and service sectors <transformation>. These shifts are driven by technological developments and changing labor market demands.