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Population Growth and Natural Resource Scarcity: Long run development under seemingly unfavourable conditions

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  • Lucas Bretschger

Abstract

The paper considers an economy which is constrained by natural resource use and driven by knowledge accumulation. Resources are essential inputs in all the sectors. It is shown that population growth and poor input substitution are not detrimental but, on the contrary, even necessary for obtaining a sustainable consumption level. We find a new type of Hartwick rule defining the conditions for a constant innovation rate. The rule does not apply to capital but to labour growth, the crucial input in research. Furthermore, it relates to the sectoral structure of the economy and to demographic transition. The results continue to hold with a backstop technology and are extended for the case of minimum resource constraints.

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File URL: http://www.oxcarre.ox.ac.uk/images/stories/papers/ResearchPapers/oxcarrerp201037.pdf
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Bibliographic Info

Paper provided by Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford in its series OxCarre Working Papers with number 037.

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Date of creation: 2010
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Handle: RePEc:oxf:oxcrwp:037

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Related research

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

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  1. Partha Dasgupta, 1995. "The Population Problem: Theory and Evidence," Journal of Economic Literature, American Economic Association, vol. 33(4), pages 1879-1902, December.
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  3. d'Autume, Antoine & Schubert, Katheline, 2008. "Hartwick's rule and maximin paths when the exhaustible resource has an amenity value," Journal of Environmental Economics and Management, Elsevier, vol. 56(3), pages 260-274, November.
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Citations

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Cited by:
  1. Pietro F. Peretto & Simone Valente, 2011. "Growth on a Finite Planet: Resources, Technology and Population in the Long Run," CER-ETH Economics working paper series 11/147, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
  2. 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.
  3. 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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