Advanced Search
MyIDEAS: Login to save this paper or follow this series

Capital accumulation and resources depletion - a Hartwick rule counterfactual

Contents:

Author Info

  • Hamilton, Kirk
  • Ruta, Giovanni
  • Tajibaeva, Liaila

Abstract

How rich would resource-abundant countries be if they had actually followed the Hartwick Rule (invest resource rents in other assets) over the past 30 years? The authors use time series data on investments and rents onexhaustible resource extraction for 70 countries to answer this question. The results are striking: Gabon, Trinidad and Tobago, and Venezuela would all be as wealthy as the Republic of Korea, while Nigeria would be five times as well off as it is currently. The authors also derive a more general rule for sustainability-maintain positive constant genuine investment-and use this to draw further empirical results.

Download Info

If 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.
File URL: http://www-wds.worldbank.org/servlet/WDSContentServer/WDSP/IB/2005/02/10/000012009_20050210131151/Rendered/PDF/wps3480.pdf
Download Restriction: no

Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 3480.

as in new window
Length:
Date of creation: 01 Jan 2005
Date of revision:
Handle: RePEc:wbk:wbrwps:3480

Contact details of provider:
Postal: 1818 H Street, N.W., Washington, DC 20433
Phone: (202) 477-1234
Email:
Web page: http://www.worldbank.org/
More information through EDIRC

Related research

Keywords: International Terrorism&Counterterrorism; Economic Theory&Research; Fiscal&Monetary Policy; Capital Markets and Capital Flows; Decentralization; Economic Theory&Research; Environmental Economics&Policies; International Terrorism&Counterterrorism; Economic Growth; Banks&Banking Reform;

Other versions of this item:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
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.:
as in new window
  1. Kirk Hamilton & John Hartwick, 2005. "Investing exhaustible resource rents and the path of consumption," Canadian Journal of Economics, Canadian Economics Association, vol. 38(2), pages 615-621, May.
  2. Pritchett, Lant, 2000. "The tyranny of concepts - CUDIE (Cumulated, Depreciated Investment Effort) is NOT capital," Policy Research Working Paper Series 2341, The World Bank.
  3. Ferreira, Susana & Vincent, Jeffrey R, 2005. "Genuine Savings: Leading Indicator of Sustainable Development?," Economic Development and Cultural Change, University of Chicago Press, vol. 53(3), pages 737-54, April.
  4. World Bank, 2004. "World Development Indicators 2004," World Bank Publications, The World Bank, number 13890, October.
  5. Asheim, G.B. & Buchholz, W. & Withagen, C.A.A.M., 2002. "The Hartwick Rule: Myths and Facts," Discussion Paper 2002-52, Tilburg University, Center for Economic Research.
  6. Jeffrey D. Sachs & Andrew M. Warner, 1995. "Natural Resource Abundance and Economic Growth," NBER Working Papers 5398, National Bureau of Economic Research, Inc.
  7. Susan M. Collins & Barry P. Bosworth, 1996. "Economic Growth in East Asia: Accumulation versus Assimilation," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 27(2), pages 135-204.
  8. Solow, Robert M, 1986. " On the Intergenerational Allocation of Natural Resources," Scandinavian Journal of Economics, Wiley Blackwell, vol. 88(1), pages 141-49.
  9. Hamilton, Kirk & Clemens, Michael, 1999. "Genuine Savings Rates in Developing Countries," World Bank Economic Review, World Bank Group, vol. 13(2), pages 333-56, May.
  10. Weitzman, Martin L. & Lofgren, Karl-Gustaf, 1997. "On the Welfare Significance of Green Accounting as Taught by Parable," Journal of Environmental Economics and Management, Elsevier, vol. 32(2), pages 139-153, February.
  11. Kirk Hamilton & Cees Withagen, 2007. "Savings growth and the path of utility," Canadian Journal of Economics, Canadian Economics Association, vol. 40(2), pages 703-713, May.
  12. John W. Hartwick, 1991. "Notes on Economic Depreciation of Natural Resource Stocks and National Accounting," Working Papers 818, Queen's University, Department of Economics.
  13. Lange, Glenn-Marie & Wright, Matthew, 2004. "Sustainable development in mineral economies: the example of Botswana," Environment and Development Economics, Cambridge University Press, vol. 9(04), pages 485-505, August.
  14. Asheim, Geir & Buchholz, Wolfgang, 2003. "A General Approach to Welfare Measurement through National Income Accounting," Memorandum 32/2002, Oslo University, Department of Economics.
  15. Mas, Matilde & Perez, Francisco & Uriel, Ezequiel, 2000. "Estimation of the Stock of Capital in Spain," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 46(1), pages 103-16, March.
  16. Hartwick, John M, 1977. "Intergenerational Equity and the Investing of Rents from Exhaustible Resources," American Economic Review, American Economic Association, vol. 67(5), pages 972-74, December.
  17. John C. V. Pezzey, 2002. "Exact Measures of Income in a Hyperbolic Economy," Economics and Environment Network Working Papers 0203, Australian National University, Economics and Environment Network.
  18. 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.
  19. Dixit, Avinash & Hammond, Peter & Hoel, Michael, 1980. "On Hartwick's Rule for Regular Maximin Paths of Capital Accumulation and Resource Depletion," Review of Economic Studies, Wiley Blackwell, vol. 47(3), pages 551-56, April.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Kirk Hamilton & Giles Atkinson, 2013. "Resource Discoveries, Learning and National Income Accounting," Grantham Research Institute on Climate Change and the Environment Working Papers 117, Grantham Research Institute on Climate Change and the Environment.
  2. Bazhanov, Andrei, 2011. "Investment and resource policy under a modified Hotelling rule," MPRA Paper 32428, University Library of Munich, Germany.
  3. Djiofack, Calvin Z. & Omgba, Luc Désiré, 2011. "Oil depletion and development in Cameroon: A critical appraisal of the permanent income hypothesis," Energy Policy, Elsevier, vol. 39(11), pages 7202-7216.
  4. Massimiliano Mazzanti & Roberto Zoboli, 2012. "A Political Economy Approach to Resource Taxation: Weak Sustainability, Revenue Recycling and Regional Planning," Working Papers 201202, University of Ferrara, Department of Economics.
  5. Bazhanov, Andrei V., 2010. "Sustainable growth: Compatibility between a plausible growth criterion and the initial state," Resources Policy, Elsevier, vol. 35(2), pages 116-125, June.
  6. Frederick Ploeg, 2011. "Rapacious Resource Depletion, Excessive Investment and Insecure Property Rights: A Puzzle," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 48(1), pages 105-128, January.
  7. Bazhanov, Andrei V., 2013. "Constant-utility paths in a resource-based economy," Resource and Energy Economics, Elsevier, vol. 35(3), pages 342-355.
  8. Frederick van der Ploeg, 2009. "Rapacious Resource Depletion and Excessive Investment Fuelled by Rival Factions and Insecure Property Rights," OxCarre Working Papers 016, Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford.
  9. Frederick van der Ploeg, 2007. "Genuine Saving and the Voracity Effect," Economics Working Papers ECO2007/38, European University Institute.
  10. van der Ploeg, Frederick, 2008. "Why Do Many Resource-Rich Countries Have Negative Genuine Saving? Anticipation of Better Times or Rapacious Rent Seeking," CEPR Discussion Papers 7021, C.E.P.R. Discussion Papers.
  11. Karolina Ryszka, 2013. "Resource Extraction in a Political Economy Framework," Tinbergen Institute Discussion Papers 13-094/VIII, Tinbergen Institute.
  12. Bazhanov, Andrei, 2008. "Inconsistency between a criterion and the initial conditions," MPRA Paper 6792, University Library of Munich, Germany.
  13. Bazhanov, Andrei, 2012. "Disregarded inefficiency may dominate sustainability policies," MPRA Paper 43621, University Library of Munich, Germany.
  14. Frederick Van der Ploeg, 2010. "Rapacious Resource Depletion, Excessive Investment and Insecure Property Rights," CESifo Working Paper Series 2981, CESifo Group Munich.
  15. Bazhanov, Andrei, 2008. "Sustainable growth: Compatibility between criterion and the initial state," MPRA Paper 9914, University Library of Munich, Germany.
  16. Bazhanov, Andrei, 2013. "Inefficiency and Sustainability," MPRA Paper 51815, University Library of Munich, Germany.
  17. Bazhanov, Andrei, 2011. "Investment and current utility change in dynamically inefficient economies," MPRA Paper 35487, University Library of Munich, Germany.
  18. Hamilton, Kirk & Atkinson, Giles, 2013. "Resource discoveries, learning, and national income accounting," Policy Research Working Paper Series 6505, The World Bank.
  19. Bazhanov, Andrei, 2008. "Sustainable growth: The extraction-saving relationship," MPRA Paper 9911, University Library of Munich, Germany.
  20. John C. V. Pezzey, 2005. "Sustained growth from non-renewable resources: constant absolute genuine savings and constant relative genuine savings compared," Economics and Environment Network Working Papers 0502, Australian National University, Economics and Environment Network.
  21. Barkhordar, Zahra A. & Saboohi, Yadollah, 2013. "Assessing alternative options for allocating oil revenue in Iran," Energy Policy, Elsevier, vol. 63(C), pages 1207-1216.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:3480. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.