Some Further Economics of Easter Island: Adding Subsistence and Resource Conservation
We extend Brander-Taylor's model of development on Easter Island by adding a resource subsistence requirement to people's preferences, and a conservation incentive in the form of a revenue-neutral, ad valorem tax on resource consumption. Adding subsistence improves plausibility; makes overshoot and collapse of population more extreme, and the steady state less stable; and allows for the possibility that statue building and erection will suddenly stop, in line with the archaeological evidence. We find a tax rate path which almost completely prevents overshoot, and conjecture that the overall strength of this path must rise when the subsistence level rises.
|Date of creation:||Nov 2000|
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- Brander, James A & Taylor, M Scott, 1998. "The Simple Economics of Easter Island: A Ricardo-Malthus Model of Renewable Resource Use," American Economic Review, American Economic Association, vol. 88(1), pages 119-138, March.
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- Tjalling C. Koopmans, 1976. "Concepts of Optimality and Their Uses," Cowles Foundation Discussion Papers 421, Cowles Foundation for Research in Economics, Yale University.
- Steger, Thomas M., 2000. "Economic growth with subsistence consumption," Journal of Development Economics, Elsevier, vol. 62(2), pages 343-361, August.
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