Economy Essay Example | Topics and Well Written Essays - 750 words - 4

Economy - Essay Example The second qualification for a commodity into the category of common resource is non-excludability, whereby it should not be possible to exclude a person from the consumption of such goods (Hochenberry 152). In the case of the American bison, the consumption of each unit of the bison serves to preclude other individuals from consumption. This is because, when the hunters kill the bison for commercial purposes, for example selling their meat, it precludes other people from using the same resource, since the bison are no longer available. The continuous hunting and killing of the bison will mean that at time will come when the bison get extinct and thus unavailable for consumption by the rest of the society. Therefore, the action of the hunters serves to preclude the rest of the society from consuming that resource, which the society is not restricted from using (Kang and Zhou 138). Additionally, the American bison fits in the category of common resources, since they do not pass the ex cludability criteria. The excludability criteria require that it is possible to exclude a person from the consumption of a good or a resource (Hochenberry 154). However, considering that the American bison were natural resources which were roaming on the North American grassland in the 1800s, no one could exclude any person from using such resources. Therefore, the American bison fits into the category of the common resource. ... However, after the 1800s, the number of v declined sharply, to a point that they almost became extinct (Lott 72). Whenever the forces of demand and supply are not equal, there tend to develop some pressure in the market place, where either the goods in the market will go to waste because their supply is high than the quantities demanded, or there will occur a shortage of such commodities, on the event that the demand is higher than the supply (Hochenberry 151). This situation can be rescued by adjusting the supply of goods, if the resource used in the production of such commodities is renewable, or it will lead to extinction of the commodity in the market, if the resources applied to produce the commodity are not renewable. In the case of the American bison, several factors played a role in causing their near extinction. First, the American bison were hunted by the American Indians who were living in the plains of North America prior to the 1800s (Lott 77). Considering that the India n hunters were targeting the American bison purely for food purposes, the rate of hunting was lower, than the rate of reproduction and growth of the American bison. However, in the periods after 1800s, professional hunters entered the field of hunting the American bison for a combination of commercial hunting and slaughter purposes. This meant that rate of killing the American bison was high, compared to the rate at which they were multiplying. The applicable economic concept in this case is that, the forces of demand were higher than the forces of supply (Kang and Zhou 141). Considering that the demand for the American bison for commercial and slaughter purposes was higher than the supply; which is accounted for by the rate of their