Significant achievements have been made for automated allocation of cloud resources. However, the performance of applications may be poor in peak load periods, unless their cloud resources are dynamically adjusted. Moreover, although cloud resources dedicated to different applications are virtually isolated, performance fluctuations do occur because of resource sharing, and software or hardware failures (e.g. unstable virtual machines, power outages, etc.). In this paper, we propose a decentralized economic approach for dynamically adapting the cloud resources of various applications, so as to statistically meet their SLA performance and availability goals in the presence of varying loads or failures. According to our approach, the dynamic economic fitness of a Web service determines whether it is replicated or migrated to another server, or deleted. The economic fitness of a Web service depends on its individual performance constraints, its load, and the utilization of the resources where it resides. Cascading performance objectives are dynamically calculated for individual tasks in the application workflow according to the user requirements. By fully implementing our framework, we experimentally proved that our adaptive approach statistically meets the performance objectives under peak load periods or failures, as opposed to static resource settings.