Value and depreciation of mineral resources over the very long run: An empirical contrast of different methods
AbstractThe paper contrasts empirically the results of alternative methods for estimating the value and the depreciation of mineral resources. The historical data of Mexico and Venezuela, covering the period 1920s-1980s, is used to contrast the results of several methods. These are the present value, the net price method, the user cost method and the imputed income method. The paper establishes that the net price and the user cost are not competing methods as such, but alternative adjustments to different scenarios of closed and open economies. The results prove that the biases of the methods, as commonly described in the theoretical literature, only hold under the most restricted scenario of constant rents over time. It is argued that the difference between what is expected to happen and what actually did happen is for the most part due to a missing variable, namely technological change. This is an important caveat to the recommendations made based on these models.
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 Department of Economics and Business, Universitat Pompeu Fabra in its series Economics Working Papers with number 867.
Date of creation: May 2005
Date of revision:
Contact details of provider:
Web page: http://www.econ.upf.edu/
Value; depreciation; mineral assets; net price; user costs; imputed income; environmental accounts;
Find related papers by JEL classification:
- Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
- F18 - International Economics - - Trade - - - Trade and Environment
- N56 - Economic History - - Agriculture, Natural Resources, Environment and Extractive Industries - - - Latin America; Caribbean
This paper has been announced in the following NEP Reports:
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.:
- Sefton, J. A. & Weale, M. R., 1996.
"The net national product and exhaustible resources: The effects of foreign trade,"
Journal of Public Economics,
Elsevier, vol. 61(1), pages 21-47, July.
- JA Sefton & MR Weale, . "The net national product and exhaustible resources: the effects of foreign trade," NIESR Discussion Papers 73, National Institute of Economic and Social Research.
- M. L. Weitzman, 1974.
"On the Welfare Significance of National Product in Dynamic Economy,"
125, Massachusetts Institute of Technology (MIT), Department of Economics.
- Weitzman, Martin L, 1976. "On the Welfare Significance of National Product in a Dynamic Economy," The Quarterly Journal of Economics, MIT Press, vol. 90(1), pages 156-62, February.
- 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, 1990. "Natural Resources, National Accounting and Economic Depreciation," Working Papers 771, Queen's University, Department of Economics.
- Rubio, M. del Mar, 2004.
"The capital gains from trade are not enough: evidence from the environmental accounts of Venezuela and Mexico,"
Journal of Environmental Economics and Management,
Elsevier, vol. 48(3), pages 1175-1191, November.
- M. del Mar Rubio, 2003. "The capital gains from trade are not enough: Evidence from the environmental accounts of Venezuela and Mexico," Economics Working Papers 689, Department of Economics and Business, Universitat Pompeu Fabra.
- Vincent, Jeffrey R., 1997. "Resource depletion and economic sustainability in Malaysia," Environment and Development Economics, Cambridge University Press, vol. 2(01), pages 19-37, February.
- Santopietro, George D., 1998. "Alternative methods for estimating resource rent and depletion cost: the case of Argentina's YPF," Resources Policy, Elsevier, vol. 24(1), pages 39-48, March.
- Vincent, Jeffrey R. & Panayotou, Theodore & Hartwick, John M., 1997. "Resource Depletion and Sustainability in Small Open Economies," Journal of Environmental Economics and Management, Elsevier, vol. 33(3), pages 274-286, July.
- Martin L. Weitzman, 1999.
"Pricing The Limits To Growth From Minerals Depletion,"
The Quarterly Journal of Economics,
MIT Press, vol. 114(2), pages 691-706, May.
- Weitzman, Martin L., 1999. "Pricing the Limits to Growth from Minerals Depletion," Scholarly Articles 3708467, Harvard University Department of Economics.
- Davis, Graham A. & Moore, David J., 2000. "Valuing mineral stocks and depletion in green national income accounts," Environment and Development Economics, Cambridge University Press, vol. 5(01), pages 109-127, February.
- Vincent, Jeffrey R., 2000. "Green accounting: from theory to practice," Environment and Development Economics, Cambridge University Press, vol. 5(01), pages 13-24, February.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().
If references are entirely missing, you can add them using this form.