IDEAS home Printed from https://ideas.repec.org/a/spr/jecstr/v3y2014i1p1-1210.1186-2193-2409-3-1.html
   My bibliography  Save this article

Effects of Technological Change on Non-renewable Resource Extraction and Exploration

Author

Listed:
  • Eiji Sawada
  • Shunsuke Managi

Abstract

This paper provides a non-renewable resource extraction model with both technological change and resource exploration. Especially, we consider two types of technology, extraction technology and exploration technology. We show how these technologies affect efficient non-renewable resource extraction differently. Then, progress in extraction technology drops marginal revenue of extraction and resource price by changing the structure of those dynamics, while progress in exploration technology drops marginal revenue of extraction and resource price remaining the structure of those dynamics. Finally, we illustrate the difference becomes significant when innovative technologies are developed using numerical examples. Copyright E. Sawada, S. Managi; licensee Springer 2014

Suggested Citation

  • Eiji Sawada & Shunsuke Managi, 2014. "Effects of Technological Change on Non-renewable Resource Extraction and Exploration," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 3(1), pages 1-12, December.
    • Handle: RePEc:spr:jecstr:v:3:y:2014:i:1:p:1-12:10.1186/2193-2409-3-1
    DOI: 10.1186/2193-2409-3-1
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1186/2193-2409-3-1
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1186/2193-2409-3-1?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Arrow, Kenneth J. & Chang, Sheldon, 1982. "Optimal pricing, use, and exploration of uncertain natural resource stocks," Journal of Environmental Economics and Management, Elsevier, vol. 9(1), pages 1-10, March.
    2. Im, Eric Iksoon & Chakravorty, Ujjayant & Roumasset, James, 2006. "Discontinuous extraction of a nonrenewable resource," Economics Letters, Elsevier, vol. 90(1), pages 6-11, January.
    3. Cynthia Lin, C.-Y. & Wagner, Gernot, 2007. "Steady-state growth in a Hotelling model of resource extraction," Journal of Environmental Economics and Management, Elsevier, vol. 54(1), pages 68-83, July.
    4. Pindyck, Robert S, 1978. "The Optimal Exploration and Production of Nonrenewable Resources," Journal of Political Economy, University of Chicago Press, vol. 86(5), pages 841-861, October.
    5. Pindyck, Robert S, 1980. "Uncertainty and Exhaustible Resource Markets," Journal of Political Economy, University of Chicago Press, vol. 88(6), pages 1203-1225, December.
    6. Stewart, Marion B., 1979. "Market structure and the search for exhaustible resources," Economics Letters, Elsevier, vol. 2(1), pages 85-90.
    7. Harold Hotelling, 1931. "The Economics of Exhaustible Resources," Journal of Political Economy, University of Chicago Press, vol. 39, pages 137-137.
    8. Cairns, Robert D, 1990. "The Economics of Exploration for Non-renewable Resources," Journal of Economic Surveys, Wiley Blackwell, vol. 4(4), pages 361-395.
    9. Sari, Ramazan & Hammoudeh, Shawkat & Soytas, Ugur, 2010. "Dynamics of oil price, precious metal prices, and exchange rate," Energy Economics, Elsevier, vol. 32(2), pages 351-362, March.
    10. Radetzki, Marian, 1989. "Precious metals : The fundamental determinants of their price behaviour," Resources Policy, Elsevier, vol. 15(3), pages 194-208, September.
    11. Slade, Margaret E., 1982. "Trends in natural-resource commodity prices: An analysis of the time domain," Journal of Environmental Economics and Management, Elsevier, vol. 9(2), pages 122-137, June.
    12. Chakravorty, Ujjayant & Leach, Andrew & Moreaux, Michel, 2011. "Would hotelling kill the electric car?," Journal of Environmental Economics and Management, Elsevier, vol. 61(3), pages 281-296, May.
    13. Ujjayant Chakravorty & Michel Moreaux & Mabel Tidball, 2008. "Ordering the Extraction of Polluting Nonrenewable Resources," American Economic Review, American Economic Association, vol. 98(3), pages 1128-1144, June.
    14. Farzin Y. H., 1995. "Technological Change and the Dynamics of Resource Scarcity Measures," Journal of Environmental Economics and Management, Elsevier, vol. 29(1), pages 105-120, July.
    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


    Cited by:

    1. Sugiawan, Yogi & Managi, Shunsuke, 2019. "New evidence of energy-growth nexus from inclusive wealth," Renewable and Sustainable Energy Reviews, Elsevier, vol. 103(C), pages 40-48.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Eiji Sawada & Shunsuke Managi, 2013. "Non-renewable Resource Extraction with Extraction and Exploration Technologies," Keio/Kyoto Joint Global COE Discussion Paper Series 2012-048, Keio/Kyoto Joint Global COE Program.
    2. Meier, Felix D. & Quaas, Martin F., 2021. "Booming gas – A theory of endogenous technological change in resource extraction," Journal of Environmental Economics and Management, Elsevier, vol. 107(C).
    3. Toman, Michael & Krautkraemer, Jeffrey, 2003. "Fundamental Economics of Depletable Energy Supply," RFF Working Paper Series dp-03-01, Resources for the Future.
    4. Stuermer, Martin, 2018. "150 Years Of Boom And Bust: What Drives Mineral Commodity Prices?," Macroeconomic Dynamics, Cambridge University Press, vol. 22(3), pages 702-717, April.
    5. Reynolds, Douglas B. & Baek, Jungho, 2012. "Much ado about Hotelling: Beware the ides of Hubbert," Energy Economics, Elsevier, vol. 34(1), pages 162-170.
    6. Gérard Gaudet, 2007. "Natural resource economics under the rule of Hotelling," Canadian Journal of Economics, Canadian Economics Association, vol. 40(4), pages 1033-1059, November.
    7. Lin, C.Y. Cynthia, 2009. "An Empirical Dynamic Model of OPEC and Non-OPEC," Working Papers 225895, University of California, Davis, Department of Agricultural and Resource Economics.
    8. Emilio Castillo, 2020. "Mineral Exploration and the Discovery of New Deposits," Working Papers 2020-06, Colorado School of Mines, Division of Economics and Business.
    9. Jakobsson, Kristofer & Söderbergh, Bengt & Snowden, Simon & Li, Chuan-Zhong & Aleklett, Kjell, 2012. "Oil exploration and perceptions of scarcity: The fallacy of early success," Energy Economics, Elsevier, vol. 34(4), pages 1226-1233.
    10. Jeffrey A. Krautkraemer, 1998. "Nonrenewable Resource Scarcity," Journal of Economic Literature, American Economic Association, vol. 36(4), pages 2065-2107, December.
    11. Margaret E. Slade & Henry Thille, 2009. "Whither Hotelling: Tests of the Theory of Exhaustible Resources," Annual Review of Resource Economics, Annual Reviews, vol. 1(1), pages 239-259, September.
    12. Castillo, Emilio & Roa, Cintia, 2021. "Defining geological maturity: The effect of discoveries on early-stage mineral exploration," Resources Policy, Elsevier, vol. 74(C).
    13. Julien Daubanes & Pierre Lasserre, 2019. "The supply of non-renewable resources," Canadian Journal of Economics, Canadian Economics Association, vol. 52(3), pages 1084-1111, August.
    14. Bai, Yiyi & Okullo, Samuel J., 2018. "Understanding oil scarcity through drilling activity," Energy Economics, Elsevier, vol. 69(C), pages 261-269.
    15. Kamiar Mohaddes, 2013. "Econometric modelling of world oil supplies: terminal price and the time to depletion," OPEC Energy Review, Organization of the Petroleum Exporting Countries, vol. 37(2), pages 162-193, June.
    16. Okullo, Samuel J. & Reynès, Frédéric & Hofkes, Marjan W., 2015. "Modeling peak oil and the geological constraints on oil production," Resource and Energy Economics, Elsevier, vol. 40(C), pages 36-56.
    17. Hart, Rob, 2016. "Non-renewable resources in the long run," Journal of Economic Dynamics and Control, Elsevier, vol. 71(C), pages 1-20.
    18. Roger Fouquet, 2012. "Economics of Energy and Climate Change: Origins, Developments and Growth," Working Papers 2012-08, BC3.
    19. Wang, Qiao & Balvers, Ronald, 2021. "Determinants and predictability of commodity producer returns," Journal of Banking & Finance, Elsevier, vol. 133(C).
    20. James D. Hamilton, 2012. "Oil Prices, Exhaustible Resources, and Economic Growth," NBER Working Papers 17759, National Bureau of Economic Research, Inc.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:jecstr:v:3:y:2014:i:1:p:1-12:10.1186/2193-2409-3-1. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.