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Growth and Resources in Space: Pushing the Final Frontier?

Author

Listed:
  • Martin Stuermer

    (International Monetary Fund, Research Department)

  • Maxwell Fleming

    (Department of Economics and Business, Colorado School of Mines)

  • Ian Lange

    (Department of Economics and Business, Colorado School of Mines)

  • Sayeh Shojaeinia

    (Department of Economics and Business, Colorado School of Mines)

Abstract

Growth models with resources and environmental externalities typically assume that planet Earth is a closed economy. However, private firms like Blue Origin and SpaceX have reduced the cost of rocket launches by a factor of 20 over the last decade. What if these costs continue to decline, making mining from asteroids or the moon feasible? What would be the implications for economic growth and the environment? This paper provides stylized facts about cost trends, geology and the environmental impact of mining on Earth and potentially in space. We extend a neoclassical growth model to investigate the transition from mining on Earth to space. We find that such a transition could potentially allow for continued growth of metal use, while limiting environmental and social costs on Earth. Acknowledging the high uncertainty around the topic, our paper provides a starting point for research on how space mining could contribute to sustainable growth on Earth.

Suggested Citation

  • Martin Stuermer & Maxwell Fleming & Ian Lange & Sayeh Shojaeinia, 2023. "Growth and Resources in Space: Pushing the Final Frontier?," Working Papers 2023-02, Colorado School of Mines, Division of Economics and Business.
    • Handle: RePEc:mns:wpaper:wp202302
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    File URL: http://econbus-papers.mines.edu/working-papers/wp202302.pdf
    File Function: First version, 2023
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    References listed on IDEAS

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    More about this item

    Keywords

    space economics; metals; mining; growth; sustainability;
    All these keywords.

    JEL classification:

    • Q32 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Exhaustible Resources and Economic Development
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • Q02 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Commodity Market

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