probably the finding that "generalism is not always optimal in uncertain environments". The exception is produced by environments which "place very different demands on the organization, and the duration of environmental states is short relative to the life of the organization". Thus, the niche theory explains variations in industrial structure in different industries. The theory shows how different structures in different industries (generalist vs specialist organizations) are shaped by relevant environments. Density dependence Organizational ecology also predicts that the rates of founding and mortality are dependent on the number of organizations (density) in the market. The two central mechanisms here are legitimization (the recognition or taken-for-grantedness of that group of organizations) and competition. Legitimization generally increases (at a decreasing rate) with the number of organizations, but so does competition (at an increasing rate). The result is that legitimization processes will prevail at low numbers of organizations, while competition will at high numbers. The founding rate will therefore first increase with the number of organizations (due to an increase in legitimization) but will decrease at high numbers of organizations (due to competition). The reverse holds for mortality rates. Thus, the relationship of density to founding rates has an inverted U shape and the relationship of density to mortality rates follows a U-shaped pattern. Age dependence How an organization's risk of mortality relates to the age of that organization has also been extensively examined. Here, organizational ecologists have found a number of patterns: Liability of newness. Here, the risk of failure is high initially but declines as the organization ages. Liability of adolescence. The risk of mortality will be low at first as the organization is buffered from failure due to support by external constituents and initial endowments. But when these initial resources become depleted, the mortality hazard shoots up and then declines following the liability of newness pattern. Liabilities of aging. Here, the risk of failure increases with organizational age. This could be due to a liability of senescence (internal inefficiencies arising from the aging of the organization) or a liability of obsolescence (a growing external mismatch with the environment). Evolutionary approaches to organizations Organizational ecology can be usefully compared with evolutionary theories in economics (e.g. Nelson & Winter, 1982). Hannan and Freeman also note the influences of biological ecology and economic evolution on their population ecology model (specifically Elton, 1927; Durkheim, 1947; Hawley, 1950; and Hutchison, 1959). Main similarities between