Reference #326: Thinking in Systems
A feedback loop is a mechanism by which the behaviour of a system persists over time. When changes in a stock affect the flows into or out of that stock, a feedback loop is formed.
Feedback loops can cause stocks to maintain their level within a range (a balancing loop) or grow or decline (a reinforcing loop).
An example of a feedback loop can be found in an interest-bearing savings account. The amount of money in an account (the stock) affects the amount of interest paid into that account (the inflow). This flow is not fixed but instead varies with the stock level. The inflow then increases the stock level, which further increases the size of the inflow.
Meadows. Thinking in Systems, 2008. (25-27, 30)