ABSTRACT
The scarcity models have yielded a slow-down in the growth of output; decline in output her capita; and increase in the labor-capital cost of output. These results were built into the models, not only by explicitly defining and introducing increasing natural resource scarcity, but also by subjecting them to a set of highly restrictive constraints. The most rigorous of these constraints was the exclusion of sociotechnical change. In addition, we assumed a standard social production function that yielded constant returns to scale and diminishing marginal productivity to any factor of production as it increased relative to other inputs. We assumed a homogeneous product mix in the strict sense of unchanging proportions of the component products, so that product substitutions were ruled out. Except for the precisely defined endogenous variation of natural resources in the Ricardian model, we assumed homogeneous inputs; resources and labor and capital were each fixed packages, which could be combined with each other in varying proportions, but were each invariant in internal composition. Substitutions within the resource sector and the labor-capital sector were thus also ruled out.
