Systems thinking

Emil Urhammer

Among ecological economists, it is very common to use the word system. According to the system theorist, Donella Meadows, a system consists of a number of connected and interacting elements that are organised in such a way that they achieve something specific. In some cases, systems are organised with a particular aim in mind from the beginning, while in others, the organisation just gradually emerges. As a result of its internal organisation, a system can maintain its existence by means of a number of mechanisms in an interaction between its various parts.

According to Meadows, most system theorists agree on the following three overall features of systems: (1) The behaviour of systems is determined by their internal structure. External influences can change the functioning of a system, but the different modes of operation of the system are hidden as potential in the system itself. (2) It is very difficult to define a system. In most cases, no real system border will exist. Instead, the boundary between the system and the outside world is defined by the analysis that is conducted. (3) Systems can often be seen as systems within larger systems. In this way, systems are often characterised by a hierarchy with one system actually consisting of a number of smaller subsystems which are embedded in and function as elements in the larger system.

From the above very broad description, it is apparent that systems can be many different things. For example, a small forest lake with fish and aquatic plants can be seen as an example of a system – an ecosystem where different animal and plant species live and interact with each other. But systems are not only found in nature. For example, a society’s transport network can also be seen as a system – the transport system – and a society’s economy is also perceived by many as a system. In these examples it is possible to identify a hierarchical organisation. The forest lake is a subsystem of the entire forest ecosystem, train transport is a subsystem of the whole transport system, while the transport system can be seen as a subsystem of the overall economic system.

Through the interaction between different elements, a system can achieve a certain state that can change over time. For example, in the case of the forest lake, a particular species can ensure that the water in the lake is clear by eating algae, which would otherwise make the water cloudy. However, if the the system is pushed from the outside, its state can change. Perhaps nutrients from a farmer’s field leach into the lake so the algae obtain plenty of food, or perhaps the species that keeps the algae population down disappears because of fishing. Both can help change the balance in the lake. Such changes are often very difficult to predict because they often rely on complex interactions between the internal elements of the system, which we do not understand or are even aware of.

As described above, you can apply systems glasses in the study of many different things, and interactions between species in nature, modes of transport and economic entities can all be seen as system interactions with different feedback mechanisms. Thus, it is possible to apply systems thinking across the gap between nature, society and the economy, and it is, as previously mentioned, very difficult to distinguish the different systems from each other. The small forest lake is connected to the economy because the farmer’s economic activities influence its state, while the economy is connected to the transport system because goods and people need to be transported in order for the economy to function. Therefore, one of the major challenges in systems thinking is defining the system you want to investigate. However, this can be done by, for example, simplifying and omitting various connections to other systems.

In systems thinking and, in particular, the question of sustainability, resilience is an important concept, which concerns the ability of a system to maintain a certain state despite external influences. If we think about the forest lake’s ability to keep the water clear, one can say that the resilience is low if the farmer can only apply very small amounts of nutrients before the water becomes cloudy. In the same way, one can say that the resilience is high if it is possible to catch a very large amount of fish which keep the algae level down before the lake becomes cloudy. In the latter case, the high resilience of the system may be due to the existence of other species of fish in the lake, which also help keep the overall volume of algae down. When a species is under pressure, other species can take over and perform the same task. This capacity is important for resilience and is one of the reasons why biodiversity is emphasised as being so important for the survival of ecosystems.

System theorists often also talk about so-called tipping points, which is the point where a system goes from one state to another. If we consider the forest lake again, the tipping point is precisely when the amount of nutrients entering the lake exceeds the ability of the system to keep the water clear; the result being that the water becomes cloudy. When looking at the economy, for example, the tipping point may be when a housing bubble bursts and the housing market collapses with plummeting house prices, bankruptcies and foreclosures.

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