As new technologies experience rapid adoption via positive feedback loops (lower prices, higher demand, increased production volume), incumbent producers face opposite feedback loops: falling demand, production cuts, job layoffs, financial devaluation, loss of investors, and increased cost of capital, creating a 'perfect storm' of business decline and stranded assets, particularly severe in capital-intensive and leveraged sectors.
causalpending
Evidence Quote
“As new producers enjoyed a rapid upward surge, existing producers experienced feedback loops that went in the opposite direction, accelerating their decline. They very quickly lost their structural advantage as diseconomies of scale kicked in.”
Created: 8/11/2026, 1:14:56 AM
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