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# Colonial Economic System Adaptation Mechanisms

## Definition

The processes through which colonial economies adjust to changing conditions, including market responses, policy modifications, and structural changes. More open systems typically possess better adaptation mechanisms through decentralized decision-making.

## Source Chapter

Book IV, Chapter 7

## Context

Smith emphasizes the importance of adaptation mechanisms in colonial economic systems, arguing that monopoly policies often lack effective adaptation processes. He contends that more open arrangements with market mechanisms would provide better adaptation capabilities.

## Economic Domain

General Theory

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