incomplete Dahlem guidelines

Contents

0. Basic sequence of events

The basic sequence of events related of Earth Reserve and production each tick are:

• Land endogenously renews (Earth Reserve increases) at a rate dependent on the current Earth Reserve of that patch (see section 2.1)
• Primary good firms estimate demand, plan production and produce. Marginal productivity of labor depends on the earth reserve (see section 1)
• Land degrades as function of the production (see section 2.2)

1. Productive Capacity impact on production of primary goods

The output of a primary good firm will depend on three things:

1. The amount of land they have to produce on (this is constant in current model)
2. The quality of that land (productive capacity)
3. The amount of labor they use

For simplicity, this section assumes that a firm has only a single unit of land (a patch in NetLogo). The graph below shows the output of a primary good firm, O, as a function of labor, L, and productive capacity, P. The function has two parameters:

• $\alpha$: the diminishing rate of marginal returns to labor. A value of 1 indicates no diminishing returns
• $P$: the productive capacity of this piece of land