On Market Adjustment and Internal Management

On Market Adjustment and Internal Management

For biological entities, we need to adjust to environment constantly. When predators attack us, when we detect preys, we must act or react instantly. But the cells in our bodies don’t necessarily adjust to external environment instantly. Instead, our bodies try to maintain relatively stable internal environment so different cells can concentrate on doing their jobs most efficiently.

Similarly, business owners and managers may need to monitor market condition often and adjust business strategies accordingly. But individual staffs in a business may not watch the market every minute. Instead, most businesses try to maintain relatively stable internal environment so different staffs can concentrate on their daily routines most efficiently.

Not all animals maintain the same level of internal stability.  Reptiles don’t maintain same internal temperature all the time, with lower energy cost. Mammals, on the other hand, actively maintain their body temperature at nearly constant temperature, at great cost.

Similarly, not all businesses maintain the same level of internal stability. Small businesses don’t spend as much to maintain a consistent and high level performance. Large companies, on the other hand, will spend great amount of resources to train and maintain high level performance.

On the national level, poor countries generally don’t maintain an elaborate welfare system and old age pension system. Their governments generally tax less extensively. Wealthy countries, on the other hand, generally maintain an elaborate welfare system and old age pension system. Their governments generally develop an elaborate tax and deduction system to support such a welfare state.

There are no permanent dominant living systems. Each adapts to specific environment. And living systems themselves become the environment of other organisms. When environment changes, the original adaptable systems may not be able to adapt to the new environment. Life always evolves with the ever-evolving environment.

Similarly, there are no permanent dominant social systems. Each adapts to specific social environment. And social systems themselves become the environment of other social systems and individuals. When environment changes, the original adaptable social systems may not be able to adapt to the new environment. Social systems always evolve with the ever-evolving environment.

But the dominant classes naturally wish their social systems to last forever. Hence the dominant theory of any time, any place is the equilibrium theory, or end of history theory. After the development of evolutionary theory in biology, the dominant classes are always working hard to separate human societies from the rest of the biological systems. They constantly condemn social Darwinism, as if humans, who have terminated many species and take over more resources than any other species, are less savage than other animals.

Academic economists, who fiercely promote the idea of free market competition, enjoy tenure system so they themselves are sheltered from the market competition life long.