This is a section in the chapter “Equilibrium, instability, growth and feedback in economics” – see B7 for the abstract.

It describes how the competition between firms has the characteristics of an arms race. The major relevant feature is that the relative positions of the rival firms do not necessarily change in a major way. For example, in cost-and-price competition, the (dis)advantage of any particular firm may not change all that much, but at the aggregate level, continuing change occurs – in this case an unrelenting fall in unit costs and prices.