OLIGOPOLY STATES (Law of)
| Collection | International Encyclopedia of Systems and Cybernetics |
|---|---|
| Year | 2004 |
| Vol. (num.) | 2(2) |
| ID | ◀ 2344 ▶ |
| Object type | General information, Human sciences, Methodology or model |
- “If there are competing organizations, the instability of their relations and hence the danger of frictions and conflicts increase with the decrease of the number of those organizations.” (L.von BERTALANFFY, 1956, p.8).
This law, which was first stated by V. VOLTERRA (1931), is applicable for example to competitive populations: thus ecological systems with numerous complementary species are more stable than those which count with only some few (This is why monocultivation brings along so many problems). VOLTERRA showed that in systems scantily diversified, destruction of the prey species by the predatory can lead to the disappearance of the latter altogether, due to the lack of any alternate resources.
The application of the law to economical oligopolies is not so obvious, but would be an interesting subject for scrutiny. Moreover, while conflicts between a reduced number of very big organizations can be very costly, it should be interesting to consider other aspects as for example the total costs of numerous small local conflicts between organizations of a lesser size, or what could be the significance of a prey-predator analogue relation between differentiated organizations.