Optimal Substitution Of Renewable And Nonrenewable Natural Resources In Production
AbstractA theoretical model is presented in order to study the optimal combination of natural resources, used as inputs, taking into account their natural growth ability and the technical possibilities of input substitution. The model enables us to consider renewable resources, nonrenewable, or both. The relative use of resources evolves through time according to the difference between both resources' natural growth and technological flexibility, as measured by the elasticity of substitution of the production function. Output evolves according to a version of the traditional Keynes-Ramsey rule, where the marginal productivity of capital is substituted by the ''marginal productivity of natural capital'', that is a combination of both resources' marginal growth weighted by each resource return in production.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie) in its series Working Papers. Serie AD with number 2001-14.
Length: 25 pages
Date of creation: May 2001
Date of revision:
Publication status: Published by Ivie
Renewable Resources; Nonrenewable Resources; Production; Optimal Control.;
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- John Hartwick & Murray Kemp & Ngo van Long, 1980.
"Set-up Costs and Theory of Exhaustible Resources,"
412, Queen's University, Department of Economics.
- M. L. Weitzman, 1975.
"The Optimal Development of Resource Pools,"
147, Massachusetts Institute of Technology (MIT), Department of Economics.
- Swallow, Stephen K., 1990. "Depletion of the environmental basis for renewable resources: The economics of interdependent renewable and nonrenewable resources," Journal of Environmental Economics and Management, Elsevier, vol. 19(3), pages 281-296, November.
- Pindyck, Robert S., 1980.
"The optimal production of an exhaustible resource when price is exogenous and stochastic,"
1162-80., Massachusetts Institute of Technology (MIT), Sloan School of Management.
- Pindyck, Robert S, 1981. " The Optimal Production of an Exhaustible Resource When Price is Exogenous and Stochastic," Scandinavian Journal of Economics, Wiley Blackwell, vol. 83(2), pages 277-88.
- Tahvonen Olli & Kuuluvainen Jari, 1993. "Economic Growth, Pollution, and Renewable Resources," Journal of Environmental Economics and Management, Elsevier, vol. 24(2), pages 101-118, March.
- Stiglitz, Joseph E. & Dasgupta, Partha, 1982. "Market structure and resource depletion: A contribution to the theory of intertemporal monopolistic competition," Journal of Economic Theory, Elsevier, vol. 28(1), pages 128-164, October.
- Hartwick, John M, 1978. "Substitution among Exhaustible Resources and Intergenerational Equity," Review of Economic Studies, Wiley Blackwell, vol. 45(2), pages 347-54, June.
- John M. Hartwick, 1990.
"Natural Resources, National Accounting and Economic Depreciation,"
771, Queen's University, Department of Economics.
- Hartwick, John M., 1990. "Natural resources, national accounting and economic depreciation," Journal of Public Economics, Elsevier, vol. 43(3), pages 291-304, December.
- John M. Hartwick, 1978.
"Investing Returns from Depleting Renewable Resource Stocks and Intergenerational Equity,"
294, Queen's University, Department of Economics.
- Hartwick, John M., 1978. "Investing returns from depleting renewable resource stocks and intergenerational equity," Economics Letters, Elsevier, vol. 1(1), pages 85-88.
- Stiglitz, Joseph E, 1976. "Monopoly and the Rate of Extraction of Exhaustible Resources," American Economic Review, American Economic Association, vol. 66(4), pages 655-61, September.
- 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.
- Heal, Geoffrey M., 1993.
"The optimal use of exhaustible resources,"
Handbook of Natural Resource and Energy Economics,
in: A. V. Kneese† & J. L. Sweeney (ed.), Handbook of Natural Resource and Energy Economics, edition 1, volume 3, chapter 18, pages 855-880
- Weinstein, Milton C & Zeckhauser, Richard J, 1975. "The Optimal Consumption of Depletable Natural Resources," The Quarterly Journal of Economics, MIT Press, vol. 89(3), pages 371-92, August.
- Pindyck, Robert S, 1978. "The Optimal Exploration and Production of Nonrenewable Resources," Journal of Political Economy, University of Chicago Press, vol. 86(5), pages 841-61, October.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Departamento de Edición).
If references are entirely missing, you can add them using this form.