English

Diversification versus specialization -- lessons from a noise driven linear dynamical system

Physics and Society 2014-11-19 v1 Adaptation and Self-Organizing Systems Popular Physics Quantitative Methods Risk Management

Abstract

Specialization and diversification are two major strategies that complex systems might exploit. Given a fixed amount of resources, the question is whether to invest this in elements that respond in a correlated manner to external perturbations, or to build a diversified system with groups of elements that respond in a not necessarily correlated manner. This general dilemma is investigated here using a high dimensional discrete dynamical system subject to an external noise, analyzing the statistical properties of an order parameter that quantifies growth. Our analytical solution suggests that diversification is a good strategy once the system has a fair amount of resources. For systems with small or extremely large supplies, we argue that specialization might be a more successful strategy. We discuss the results also from the perspective of economic and biologic systems.

Keywords

Cite

@article{arxiv.1411.4756,
  title  = {Diversification versus specialization -- lessons from a noise driven linear dynamical system},
  author = {Gabriell Mate and Zoltan Neda},
  journal= {arXiv preprint arXiv:1411.4756},
  year   = {2014}
}

Comments

5 pages

R2 v1 2026-06-22T07:02:36.329Z