Understanding the Complexity of Economic, Ecological, and Social Systems

C. S. Holling argues that ecosystems, economies, and societies periodically undergo four stages of an adaptive cycle in which their levels of resilience, connectivity, and wealth (or “potential”) vary in characteristic ways. Over time, a system gets locked-in to a particular way of operating in which it accumulates immense wealth, expands connectivity to maximize efficiency, but gradually loses its resilience. The release (collapse) phase then frees up the accumulated wealth and opens a period of novelty and experimentation, before the cycle begins anew. Holling further argues that adaptive cycles are nested in other cycles at higher and lower spatial and temporal scales to form a “panarchy” that can provide stability or create tipping cascades depending on how those cycles align in their phases.