Update 1.md

content/papers/1.md

@@ -12,7 +12,7 @@ summary: "How to efficiently allocate common-pool resources over the long run? T
 
 ##### Abstract
 
-Competitive entry and investment in the commons can result in resource depletion and congestion externalities over the long run. But little evidence exists on the efficient allocation of common-pool resources when industry structure is flexible. This paper develops a model of common-pool industry dynamics and applies it to the 19th-century American whaling industry, a global commons for oil production. The estimated model reveals a prevailing excess of players and capital compared to the first-best allocation. Counterfactual simulation quantifies negative externalities by identifying the shadow values of whaling. It underscores the necessity of incorporating the evolution of industry structure into the design of a tax system to achieve efficient allocation. 
+Competitive entry and investment in the commons can result in resource depletion and congestion externalities. But little evidence exists on the efficient allocation of common-pool resources over the long run. This paper develops a model of common-pool industry dynamics and applies it to the 19th-century American whaling industry, a global commons for oil production. The estimated model reveals a prevailing excess of players and capital compared to the first-best allocation. Counterfactual simulation quantifies negative externalities by identifying the shadow values of whaling. This underscores the significance of industry structure evolution in designing policies to achieve efficient allocation.
 
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