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Population growth and natural resource scarcity: long-run development under seemingly unfavourable conditions

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Abstract

The paper develops a model with non-exponential population growth, nonrenewable natural resources, and endogenous knowledge creation to analyse substitution between primary inputs and an essential use of resources in the innovation sectors, which is generally considered as most unfavourable for growth. We show that population growth and poor input substitution are not detrimental but even needed to obtain sustainable consumption. A permanent increase in living standards can be achieved under free market conditions. With a backstop technology, the system converges to a balanced growth path with classical properties.

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Paper provided by CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich in its series CER-ETH Economics working paper series with number 08/87.

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Length: 30 pages
Date of creation: Jun 2008
Date of revision:
Handle: RePEc:eth:wpswif:08-87

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Keywords: Population growth; non-renewable resources; poor input substitution; technical change; sustainability;

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  15. Lopez, Ramon E. & Anriquez, Gustavo & Gulati, Sumeet, 2007. "Structural change and sustainable development," Journal of Environmental Economics and Management, Elsevier, vol. 53(3), pages 307-322, May.
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Citations

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Cited by:
  1. Zhang, W.-B., 2014. "Ethnic Human Capital Externalities and Inequality in a General Equilibrium Growth Model," Journal of the New Economic Association, New Economic Association, vol. 21(1), pages 33-54.
  2. Pietro F. Peretto & Simone Valente, 2013. "Growth on a Finite Planet: Resources, Technology, and Population in the Long Run," Working Papers 13-9, Duke University, Department of Economics.
  3. Karen Pittel & Lucas Bretschger, 2009. "The Implications of Heterogeneous Resource Intensities on Technical Change and Growth," CER-ETH Economics working paper series 09/120, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
  4. Lopez, Ramon E. & Stocking, Andrew, 2009. "Bringing Growth Theory "Down to Earth"," Working Papers 48944, University of Maryland, Department of Agricultural and Resource Economics.

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