A presumption underlying the analysis here is that property rights were incomplete, perhaps not to the point of full open access, but at least to the point where it was hard to prevent increased harvesting as the population increased. Specifically, in Eq. (1) harvesting is assumed to be increasing with population size for any given stock. This need not be the case if property rights are complete, because an efficient owner or manager of the resource would restrict access beyond some optimal point.
It is unlikely that Easter Island was characterized by complete open access, but it is very likely that property rights were incomplete in the sense that different competing harvesters probably had access to some common part of the forest. Incomplete property rights give rise to market failure, with the result that overharvesting occurs. In other words, the individual incentives faced by individual harvesters (or by small kinship groups) would lead to overharvesting from the collective point of view. As shown in Fig. 4, even with incomplete property rights, it is still possible to have monotonic adjustment to a steady state if parameter values are suitable. However, it would be even better if the society could enforce strict property rights. If a dictator or ‘‘social planner’’ could impose strict property rights, that person could, for example, set harvesting at the level of maximum sustainable yield and keep harvesting at that level independent of population size. However, by all accounts, that level of control was very difficult to impose and maintain in Polynesian and in most other societies.
In addition to the property rights problem, there was also a significant intertemporal market failure problem. Specifically, no one who planted or nurtured a young wine palm could expect to make personal use of that tree in his or lifetime, because life expectancy was short relative to the time taken for trees to reach maturity. Even the planter’s children would be unlikely to benefit from the such activity. It would be the generation of one’s grandchildren who would benefit from current planting activity. Thus, the incentives to undertake investments in planting and growing were weak. In modern societies, someone who plants a stand of trees can sell the stand at any time to someone else willing to hold the tree lot for some period of time–secure in the knowledge that it can be sold to still another person in the future. This mechanism of overlapping ownership connected through markets allows, in effect, future generations to ‘‘pay’’ for current investments. This is necessary for economic efficiency. However, in the Easter Island context, there would be no such markets. Thus, there would be a ‘‘market failure’’ leading to under investment in planting and growing trees. In primitive societies, social norms often take the place of market transactions in enforcing particular economic investments, but social norms are highly unreliable. In the Easter Island case, it is quite possible that the statue-carving norm dominated any conservation norms and worsened rather than mitigated the overharvesting problem.