IDEAS home Printed from https://ideas.repec.org/a/spr/jecstr/v7y2018i1d10.1186_s40008-018-0107-1.html
   My bibliography  Save this article

An exhaustible resources model in a dynamic input–output framework: a possible reconciliation between Ricardo and Hotelling

Author

Listed:
  • Biao Huang

    (Renmin University of China)

Abstract

This study investigates the problem of exhaustible resources using a dynamic input–output model with classical features. Following past research on the topic, further reconciliation can be made between the analyses of Ricardo and Hotelling on exhaustible resources by introducing resource-searching activities. The study’s model is based on a given real wage rate and a given consumption vector. The model reveals that the paths of prices, royalties, rents, intensities of production and searching processes can be determined once a sequence of profit rates as well as the initial amounts of commodities and resources are given. This paper also discusses the circumstances under which commodity prices are constant when exhaustible resources exist, based on the model presented.

Suggested Citation

  • Biao Huang, 2018. "An exhaustible resources model in a dynamic input–output framework: a possible reconciliation between Ricardo and Hotelling," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 7(1), pages 1-24, December.
    • Handle: RePEc:spr:jecstr:v:7:y:2018:i:1:d:10.1186_s40008-018-0107-1
    DOI: 10.1186/s40008-018-0107-1
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1186/s40008-018-0107-1
    File Function: Abstract
    Download Restriction: no
    File URL: https://libkey.io/10.1186/s40008-018-0107-1?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
    ---><---

    References listed on IDEAS

    as
    1. Kurt Kratena & Stefan Schleicher, 1999. "Impact of Carbon Dioxide Emissions Reduction on the Austrian Economy," Economic Systems Research, Taylor & Francis Journals, vol. 11(3), pages 245-261.
    2. J. A. Kregel (ed.), 1983. "Distribution, Effective Demand and International Economic Relations," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-349-17177-4.
    3. �scar Deju�n & Luis Antonio L�pez & Mar�a �ngeles Tobarra & Jorge Zafrilla, 2013. "A Post-Keynesian Age Model To Forecast Energy Demand In Spain," Economic Systems Research, Taylor & Francis Journals, vol. 25(3), pages 321-340, September.
    4. Fabio Ravagnani, 2008. "Classical Theory and Exhaustible Natural Resources: Notes on the Current Debate," Review of Political Economy, Taylor & Francis Journals, vol. 20(1), pages 79-93.
    5. Heinz Kurz & Neri Salvadori, 2006. "Input-Output Analysis from a Wider Perspective: a Comparison of the Early Works of Leontief and Sraffa," Economic Systems Research, Taylor & Francis Journals, vol. 18(4), pages 373-390.
    6. Erik Dietzenbacher & Jesper Stage, 2006. "Mixing oil and water? Using hybrid input-output tables in a Structural decomposition analysis," Economic Systems Research, Taylor & Francis Journals, vol. 18(1), pages 85-95.
    7. D. W. Jorgenson, 1971. "Stability of a Dynamic Input-Output System," Palgrave Macmillan Books, in: F. H. Hahn (ed.), Readings in the Theory of Growth, chapter 20, pages 264-275, Palgrave Macmillan.
    8. Sergio Parrinello, 2004. "The Notion of Effectual Supply and the Theory of Normal Prices with Exhaustible Natural Resources," Economic Systems Research, Taylor & Francis Journals, vol. 16(3), pages 311-322.
    9. Graham Treloar, 1997. "Extracting Embodied Energy Paths from Input-Output Tables: Towards an Input-Output-based Hybrid Energy Analysis Method," Economic Systems Research, Taylor & Francis Journals, vol. 9(4), pages 375-391.
    10. Christian Bidard & Guido Erreygers, 2001. "The Corn–Guano Model," Metroeconomica, Wiley Blackwell, vol. 52(3), pages 243-253, August.
    11. Shigemi Kagawa & Hajime Inamura, 2004. "A Spatial Structural Decomposition Analysis of Chinese and Japanese Energy Demand: 1985-1990," Economic Systems Research, Taylor & Francis Journals, vol. 16(3), pages 279-299.
    12. Sergio Parrinello, 1983. "Exhaustible Natural Resources and the Classical Method of Long-Period Equilibrium," Palgrave Macmillan Books, in: J. A. Kregel (ed.), Distribution, Effective Demand and International Economic Relations, chapter 6, pages 186-199, Palgrave Macmillan.
    13. Harold Hotelling, 1931. "The Economics of Exhaustible Resources," Journal of Political Economy, University of Chicago Press, vol. 39, pages 137-137.
    14. Christoph Weber & Hermann Schnabl, 1998. "Environmentally Important Inter sectoral Flows: Insights from Main Contributions Identification and Minimal Flow Analysis," Economic Systems Research, Taylor & Francis Journals, vol. 10(4), pages 337-356.
    15. Heinz Kurz & Neri Salvadori, 1997. "Exhaustible Resources in a Dynamic Input-Output Model with 'Classical' Features," Economic Systems Research, Taylor & Francis Journals, vol. 9(3), pages 235-252.
    16. Heinz D. Kurz & Neri Salvadori, 2001. "Classical Economics and the Problem of Exhaustible Resources," Metroeconomica, Wiley Blackwell, vol. 52(3), pages 282-296, August.
    17. Masahiko Aoki, 1977. "Dual Stability in a Cambridge-type Model," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 44(1), pages 143-151.
    18. Robert M. Solow, 1974. "The Economics of Resources or the Resources of Economics," Palgrave Macmillan Books, in: Chennat Gopalakrishnan (ed.), Classic Papers in Natural Resource Economics, chapter 12, pages 257-276, Palgrave Macmillan.
    19. Kurz,Heinz D. & Salvadori,Neri, 1997. "Theory of Production," Cambridge Books, Cambridge University Press, number 9780521588676.
    20. Christian Lager, 2001. "A Note on Non-Stationary Prices," Metroeconomica, Wiley Blackwell, vol. 52(3), pages 297-300, August.
    21. Imre Dobos & Adel Floriska, 2005. "A Dynamic Leontief Model with Non-renewable Resources," Economic Systems Research, Taylor & Francis Journals, vol. 17(3), pages 317-326.
    22. Luenberger, David G & Arbel, Ami, 1977. "Singular Dynamic Leontief Systems," Econometrica, Econometric Society, vol. 45(4), pages 991-995, May.
    23. Salvadori, Neri, 1985. "Switching in Methods of Production and Joint Production," The Manchester School of Economic & Social Studies, University of Manchester, vol. 53(2), pages 156-178, June.
    24. Bertram Schefold, 2001. "Critique of the Corn–Guano Model," Metroeconomica, Wiley Blackwell, vol. 52(3), pages 316-328, August.
    25. Sergio Parrinello, 2001. "The Price of Exhaustible Resources," Metroeconomica, Wiley Blackwell, vol. 52(3), pages 301-315, August.
    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. Ruoyu Chen & Chukiat Chaiboonsri & Satawat Wannapan, 2021. "The Perspective of Thailand Economy After the Effect of Coronavirus-19 Pandemics: Explication by Dynamic I-O Models and Agent-Based Simulations," SAGE Open, , vol. 11(2), pages 21582440211, June.

    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. Yoann Verger, 2015. "Sraffa and the environment," Working Papers hal-01186009, HAL.
    2. Sergio Parrinello, 2002. "Exhaustible natural resources, normal prices and intertemporal equilibrium," Working Papers in Public Economics 57, University of Rome La Sapienza, Department of Economics and Law.
    3. Sergio Parrinello, 2004. "The Notion of Effectual Supply and the Theory of Normal Prices with Exhaustible Natural Resources," Economic Systems Research, Taylor & Francis Journals, vol. 16(3), pages 311-322.
    4. Fabio Ravagnani, 2008. "Classical Theory and Exhaustible Natural Resources: Notes on the Current Debate," Review of Political Economy, Taylor & Francis Journals, vol. 20(1), pages 79-93.
    5. Yoann Verger, 2017. "Sraffa and the revenue of the owner of non- renewable natural resources: notes on a never- ending debate [Sraffa et le revenu du propriétaire d'une ressource naturelle non-renouvelable: notes sur u," Working Papers hal-01596166, HAL.
    6. Manfred Lenzen, 2001. "A Generalized Input-Output Multiplier Calculus for Australia," Economic Systems Research, Taylor & Francis Journals, vol. 13(1), pages 65-92.
    7. Tony Aspromourgos, 2004. "Sraffian research programmes and unorthodox economics," Review of Political Economy, Taylor & Francis Journals, vol. 16(2), pages 179-206.
    8. Yoann Verger, 2015. "A Critique of Attempts to Introduce Hotelling's rule in Sraffa's Theory," Working Papers hal-01193072, HAL.
    9. Dale W. Henderson & Stephen W. Salant, 1976. "Market anticipations, government policy, and the price of gold," International Finance Discussion Papers 81, Board of Governors of the Federal Reserve System (U.S.).
    10. Sergio Parrinello, 2014. "A search for distinctive features of demand-led growth models," PSL Quarterly Review, Economia civile, vol. 67(270), pages 309-342.
    11. Hala Abu-Kalla & Ruslana Rachel Palatnik & Ofira Ayalon & Mordechai Shechter, 2020. "Hoard or Exploit? Intergenerational Allocation of Exhaustible Natural Resources," Energies, MDPI, vol. 13(24), pages 1-20, December.
    12. Devarajan, Shantayanan & Fisher, Anthony C, 1981. "Hotelling's "Economics of Exhaustible Resources": Fifty Years Later," Journal of Economic Literature, American Economic Association, vol. 19(1), pages 65-73, March.
    13. Franco, Marco P.V. & Gaspard, Marion & Mueller, Thomas, 2019. "Time discounting in Harold Hotelling's approach to natural resource economics: The unsolved ethical question," Ecological Economics, Elsevier, vol. 163(C), pages 52-60.
    14. Benchekroun, Hassan & Ray Chaudhuri, Amrita & Tasneem, Dina, 2020. "On the impact of trade in a common property renewable resource oligopoly," Journal of Environmental Economics and Management, Elsevier, vol. 101(C).
    15. Sorin-George Toma & Paul Marinescu & Catalin Gradinaru, 2016. "The Age Of Sustainable Business Models," Management Strategies Journal, Constantin Brancoveanu University, vol. 34(4), pages 128-132.
    16. Stephen W. Salant, 1977. "Staving off the backstop: dynamic limit-pricing with a kinked demand curve," International Finance Discussion Papers 110, Board of Governors of the Federal Reserve System (U.S.).
    17. Schilling, Markus & Chiang, Lichun, 2011. "The effect of natural resources on a sustainable development policy: The approach of non-sustainable externalities," Energy Policy, Elsevier, vol. 39(2), pages 990-998, February.
    18. Daubanes, Julien, 2011. "Optimal taxation of a monopolistic extractor: Are subsidies necessary?," Energy Economics, Elsevier, vol. 33(3), pages 399-403, May.
    19. Roma, Antonio & Pirino, Davide, 2009. "The extraction of natural resources: The role of thermodynamic efficiency," Ecological Economics, Elsevier, vol. 68(10), pages 2594-2606, August.
    20. Robert Cairns, 2001. "Capacity Choice and the Theory of the Mine," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 18(1), pages 129-148, January.

    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:7:y:2018:i:1:d:10.1186_s40008-018-0107-1. 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.