When is it Optimal to Exhaust a Resource in a Finite Time?
Exhaustion of a natural resource stock may be a rational choice for an individual and/or a community, even if a sustainable use for the resource is feasible and the resource users are farsighted and well informed on the ecosystem. We identify conditions under which it is optimal not to sustain resource use. These conditions concern the discounting of future benefits, instability of social system or ecosystem, nonconvexity of natural growth function, socio-psychological value of employment, and strategic interaction among resource users. The identification of these conditions can help design policies to prevent unsustainable patterns of resource use.
|Date of creation:||Feb 2006|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: http://www.feem.it/
More information through EDIRC
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.:
- Kaushik Basu & Tapan Mitra, 2003.
"Aggregating Infinite Utility Streams with InterGenerational Equity: The Impossibility of Being Paretian,"
Econometric Society, vol. 71(5), pages 1557-1563, 09.
- Basu, Kaushik & Mitra, Tapan, 2003. "Aggregating Infinite Utility Streams with Inter-generational Equity: The Impossibility of Being Paretian," Working Papers 03-03, Cornell University, Center for Analytic Economics.
- Solow, Robert, 1993. "An almost practical step toward sustainability," Resources Policy, Elsevier, vol. 19(3), pages 162-172, September.
- Heal, G., 1998. "Valuing the Future: Economic Theory and Sustainability," Papers 98-10, Columbia - Graduate School of Business.
- Svensson, Lars-Gunnar, 1980. "Equity among Generations," Econometrica, Econometric Society, vol. 48(5), pages 1251-56, July.
- Heal, Geoffrey M., 1993.
"The optimal use of exhaustible resources,"
Handbook of Natural Resource and Energy Economics,
in: A. V. Kneese† & J. L. Sweeney (ed.), Handbook of Natural Resource and Energy Economics, edition 1, volume 3, chapter 18, pages 855-880
- Y. Hossein Farzin, 2004. "Is an Exhaustible Resource Economy Sustainable?," Review of Development Economics, Wiley Blackwell, vol. 8(1), pages 33-46, 02.
- Gerhard Sorger, 1997.
"Markov-perfect Nash equilibria in a class of resource games,"
Springer, vol. 11(1), pages 79-100.
- Gerhard Sorger, 1996. "Markov Perfect Nash Equilibria in a Class of Resource Games," CIRANO Working Papers 96s-15, CIRANO.
- Farzin, Y. Hossein & Akao, Ken-Ichi, 2005.
"Non-pecuniary Value of Employment and Natural Resource Extinction,"
190911, University of California, Davis, Department of Agricultural and Resource Economics.
- Y. Hossein Farzin & Ken-Ichi Akao, 2006. "Non-pecuniary Value of Employment and Natural Resource Extinction," Working Papers 2006.24, Fondazione Eni Enrico Mattei.
- Romer, Paul M, 1986. "Cake Eating, Chattering, and Jumps: Existence Results for Variational Problems," Econometrica, Econometric Society, vol. 54(4), pages 897-908, July.
- Beddington, John R & Watts, C M K & Wright, W D C, 1975. "Optimal Cropping of Self-Reproducible Natural Resources," Econometrica, Econometric Society, vol. 43(4), pages 789-802, July.
- Tjalling C. Koopmans, 1959. "Stationary Ordinal Utility and Impatience," Cowles Foundation Discussion Papers 81, Cowles Foundation for Research in Economics, Yale University.
- Berck, Peter, 1979. "Open Access and Extinction," Econometrica, Econometric Society, vol. 47(4), pages 877-82, July.
- Skiba, A K, 1978. "Optimal Growth with a Convex-Concave Production Function," Econometrica, Econometric Society, vol. 46(3), pages 527-39, May.
- Dechert, W. Davis & Nishimura, Kazuo, 1983. "A complete characterization of optimal growth paths in an aggregated model with a non-concave production function," Journal of Economic Theory, Elsevier, vol. 31(2), pages 332-354, 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.
- Christophe Deissenberg, Gustav Feichtinger, Willi Semmler and Franz Wirl, 2001. "History Dependence and Global Dynamics in Models with Multiple Equilibria," Computing in Economics and Finance 2001 257, Society for Computational Economics.
- Hartl, Richard F., 1987. "A simple proof of the monotonicity of the state trajectories in autonomous control problems," Journal of Economic Theory, Elsevier, vol. 41(1), pages 211-215, February.
- Magill, Michael J P, 1981. "Infinite Horizon Programs," Econometrica, Econometric Society, vol. 49(3), pages 679-711, May.
- Ken-Ichi Akao, 2008. "Tax schemes in a class of differential games," Economic Theory, Springer, vol. 35(1), pages 155-174, April.
- Y. Hossein Farzin & Ken-Ichi Akao, 2004. "Non-pecuniary Value of Employment and Individual Labor Supply," Working Papers 2004.158, Fondazione Eni Enrico Mattei.
When requesting a correction, please mention this item's handle: RePEc:fem:femwpa:2006.23. 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: (barbara racah)
If references are entirely missing, you can add them using this form.