On natural resource substitution
We present a simple dynamic model to get some key insights about the substitution of renewable for nonrenewable resources in production and the consequences for sustainability. We highlight the role of the elasticity of substitution (technological component) to determine the adjustment of every sector as a response to scarcity and growing ability of resources (environmental component). Sometimes, the model predicts a smooth substitution of renewable resources for nonrenewables, but this process could work in the opposite direction if renewable resources are temporarily beyond their maximum sustainable yield, so that their marginal natural growth is negative. If substitution possibilities are high enough, it may be optimal to suspend the extraction of a resource, for example, to allow for regeneration of the biomass. We show analytically that a production process is more likely to be sustainable the more heavily it depends on renewable, rather than nonrenewable resources.
(This abstract was borrowed from another version of this item.)
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.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
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.:
- 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.
- 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.
- Spence, A Michael & Starrett, David, 1975. "Most Rapid Approach Paths in Accumulation Problems," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 16(2), pages 388-403, June.
- Bovenberg, A.L. & Smulders, J.A., 1995.
"Environmental quality and pollution-augmenting technological change in a two-sector endogenous growth model,"
Other publications TiSEM
6784bb12-71fb-45a5-bf7e-8, Tilburg University, School of Economics and Management.
- Lans Bovenberg, A. & Smulders, Sjak, 1995. "Environmental quality and pollution-augmenting technological change in a two-sector endogenous growth model," Journal of Public Economics, Elsevier, vol. 57(3), pages 369-391, July.
- Groth Christian, 2004.
"Strictly Endogenous Growth with Non-renewable Resources Implies an Unbounded Growth Rate,"
The B.E. Journal of Macroeconomics,
De Gruyter, vol. 4(1), pages 1-15, May.
- Christian Groth, 2003. "Strictly Endogenous Growth with Non-renewable Resources Implies an Unbounded Growth Rate," EPRU Working Paper Series 03-20, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.
- Graciela Chichilnisky, 1997. "What Is Sustainable Development?," Land Economics, University of Wisconsin Press, vol. 73(4), pages 467-491.
- Chakravorty, Ujjayant & Roumasset, James & Tse, Kinping, 1997. "Endogenous Substitution among Energy Resources and Global Warming," Journal of Political Economy, University of Chicago Press, vol. 105(6), pages 1201-34, December.
- Christian Groth & Poul Schou, 2004. "Capital Taxation, Growth, and Non-renewable Resources," EPRU Working Paper Series 04-16, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.
- John Hartwick, 1976.
"Intergenerational Equity and the Investing of Rents from Exhaustible Resources,"
220, Queen's University, Department of Economics.
- 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.
- Olli Tahvonen, 1991. "On the dynamics of renewable resource harvesting and pollution control," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 1(1), pages 97-117, March.
- Tsur, Yacov & Zemel, Amos, 2003. "Optimal transition to backstop substitutes for nonrenewable resources," Journal of Economic Dynamics and Control, Elsevier, vol. 27(4), pages 551-572, February.
- 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.
- Pezzey, J., 1992. "Sustainable Development Concepts; An Economic Analysis," Papers 2, World Bank - The World Bank Environment Paper.
- Smith, Vernon L, 1971. "Economics of Production from Natural Resources: Reply," American Economic Review, American Economic Association, vol. 61(3), pages 488-91, June.
- Di Vita, Giuseppe, 2001. "Technological change, growth and waste recycling," Energy Economics, Elsevier, vol. 23(5), pages 549-567, September.
- John M. Hartwick, 1978. "Substitution Among Exhaustible Resources and Intergenerational Equity," Review of Economic Studies, Oxford University Press, vol. 45(2), pages 347-354.
- 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.
- Huhtala, Anni, 1999. "Optimizing production technology choices: conventional production vs. recycling," Resource and Energy Economics, Elsevier, vol. 21(1), pages 1-18, January.
- R. M. Solow, 1973.
"Intergenerational Equity and Exhaustable Resources,"
103, Massachusetts Institute of Technology (MIT), Department of Economics.
- R. M. Solow, 1974. "Intergenerational Equity and Exhaustible Resources," Review of Economic Studies, Oxford University Press, vol. 41(5), pages 29-45.
- Brian R. Copeland & M. Scott Taylor, 2004.
"Trade, Growth, and the Environment,"
Journal of Economic Literature,
American Economic Association, vol. 42(1), pages 7-71, March.
- Tomiyama, Ken, 1985. "Two-stage optimal control problems and optimality conditions," Journal of Economic Dynamics and Control, Elsevier, vol. 9(3), pages 317-337, November.
- Tahvonen, Olli & Salo, Seppo, 2001. "Economic growth and transitions between renewable and nonrenewable energy resources," European Economic Review, Elsevier, vol. 45(8), pages 1379-1398, August.
- Rask, Kevin N., 1998. "Clean air and renewable fuels: the market for fuel ethanol in the US from 1984 to 1993," Energy Economics, Elsevier, vol. 20(3), pages 325-345, June.
- Gerlagh, Reyer & van der Zwaan, Bob, 2003. "Gross world product and consumption in a global warming model with endogenous technological change," Resource and Energy Economics, Elsevier, vol. 25(1), pages 35-57, February.
- Daly, Herman E., 1990. "Toward some operational principles of sustainable development," Ecological Economics, Elsevier, vol. 2(1), pages 1-6, April.
When requesting a correction, please mention this item's handle: RePEc:eee:jrpoli:v:30:y:2005:i:4:p:233-246. 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: (Shamier, Wendy)
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.