hypercycle

In the original context of chemistry, the hypercycle is a set of chemical reactions, which mutually catalyze the other reactions so that the chain of reactions becomes closed and forms a cycle. This is the most simple form of self-organization and has been proposed as one of the models for the emergence of life. The hypercycle shows completely new properties as compared to the constituent parts; in particular, it includes mechanisms of self-organization and reproduction, if there is an inflow of structurally related matter-energy. The concept of hypercycle is a convincing way to formalize the general idea of synergy. Synergy is a general phenomenon in evolution which leads to the emergence of new units of selection, in the sense of "evolutionary ratcheting", that is, units of which the formerly independent parts can no longer reproduce without the specific functions that are realized by that unit.

In EE, the model of the hypercycle is generalized as a cycle of positive >externalities between processes that are causally linked. For example, the transaction of a good between two firms can be accompanied by a flow of knowledge as an >externality that supports the production process in the receiving firm. If such a flow is cyclically connected, it leads to new properties of the state space of the constituent actors because of the emergence of a higher-level unit. For instance, in successful team production as compared to a less successful one the actions of team members support each other in a way that total productivity increases and the team can perform tasks that the single members cannot achieve. Hence, the team is an emergent unit. The related >production process is supermodular. In a similar vein, phenomena like industrial districts can be explained by the hypercyclic closure of knowledge flows between the firms.

Basic References

You find a systematic treatment of the hypercycle in the biological context in the important book:
John Maynard Smith and Eörs Szathmáry, The Major Transitions in Evolution, Oxford/New York/Heidelberg: Freeman/Spektrum, 1995

On the general concept of synergy, see the magistral overview of his two-decade research by:
Peter Corning, Nature’s Magic. Synergy in Evolution and the Fate of Humankind, Cambridge et al.: Cambridge University Press.

For some related web-resources, see
hypercycle
more on hypercycle

Semantic Field
novelty
hypercycle   externality