ADDITIVE-INTERACTION MODELS OF SPATIAL AGGLOMERATION*

A wide variety of existing models of spatial agglomeration postulate additive-interaction effects among agents. In this paper, a synthesis of such models is achieved by establishing certain mathematical equivalences between them. In particular, it is shown that Rockafellar's conjugacy theory of concave functions yields a symmetric one-to-one correspondence between three classes of existing models, here designated as spatial-accessibility models, endogenous-contact models, and fixed-contact models. These correspondences not only allow the transference of results between models, but also suggest new economic interpretations of each model in terms of its conjugate model. A series of examples are drawn from the literature to illustrate these results.     

TROPICAL DEFORESTATION AND FOREST MANAGEMENT UNDER THE SYSTEM OF CONCESSION LOGGING: A DECISION-THEORETIC ANALYSIS*

ABSTRACT. Deforestation caused by concession logging is often the result of harvest decisions which focus on short-run profits rather than on long-run sustainable harvest yields. A sequential-decision model of this type of behavior is here developed which focuses on a logger's annual decisions of whether or not to remain in compliance with the terms of a concession contract. The contract stipulates harvesting procedures for a sustained forest yield, and noncompliance is taken to result in deforestation. An optimal decision policy for the concession logger is characterized in terms of optimal-stopping theory, and is employed to construct payoff incentives which encourage compliance. In particular, a forest management problem is formulated which focuses on the effectiveness of partial inspection policies in deterring noncompliant behavior. General necessary and sufficient conditions for the effectiveness of such policies are established, and are given a more operational form for the Markov case. A numerical example based on actual concession-contract data is also developed which suggests certain policy implications.