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A Critique of Attempts to Introduce Hotelling's rule in Sraffa's Theory

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  • Yoann Verger

    (REEDS - Centre international de Recherches en Economie écologique, Eco-innovation et ingénierie du Développement Soutenable - UVSQ - Université de Versailles Saint-Quentin-en-Yvelines)

Abstract

This paper argues that the Hotelling's rule on the rise of royalties during the exhaustion of exhaustible natural resources cannot be retained within a Sraffian framework. At first, a critic of the major attempts that were developed in this domain is conducted. Then this paper brings forward the evidence that the value theory is changed by adding the Hotelling's rule and is no longer consistent with Sraffa's thinking. This paper also offers an alternative interpretation in which the rise of the rent on exhaustible natural resources is only dependent on technical requirements.

Suggested Citation

  • Yoann Verger, 2015. "A Critique of Attempts to Introduce Hotelling's rule in Sraffa's Theory," Working Papers hal-01193072, HAL.
    • Handle: RePEc:hal:wpaper:hal-01193072
    Note: View the original document on HAL open archive server: https://hal.science/hal-01193072
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    References listed on IDEAS

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    1. Hart, Rob & Spiro, Daniel, 2011. "The elephant in Hotelling's room," Energy Policy, Elsevier, vol. 39(12), pages 7834-7838.
    2. Christian Bidard & Guido Erreygers, 2001. "The Corn–Guano Model," Metroeconomica, Wiley Blackwell, vol. 52(3), pages 243-253, August.
    3. Harold Hotelling, 1931. "The Economics of Exhaustible Resources," Journal of Political Economy, University of Chicago Press, vol. 39(2), pages 137-137.
    4. Devarajan, Shantayanan & Fisher, Anthony C, 1981. "Hotelling's "Economics of Exhaustible Resources": Fifty Years Later," Journal of Economic Literature, American Economic Association, vol. 19(1), pages 65-73, March.
    5. H. Scott Gordon, 1954. "The Economic Theory of a Common-Property Resource: The Fishery," Journal of Political Economy, University of Chicago Press, vol. 62(2), pages 124-124.
    6. Heinz Kurz & Neri Salvadori, 1997. "Exhaustible Resources in a Dynamic Input-Output Model with 'Classical' Features," Economic Systems Research, Taylor & Francis Journals, vol. 9(3), pages 235-252.
    7. Kurz, Heinz D. & Salvadori, Neri, 2000. "Economic dynamics in a simple model with exhaustible resources and a given real wage rate," Structural Change and Economic Dynamics, Elsevier, vol. 11(1-2), pages 167-179, July.
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    Keywords

    Sraffa; Rent; Royalty; Hotelling’s rule; Exhaustible resource;
    All these keywords.

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