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North Sea Oil and Genuine Saving in the Scottish Economy

Author

Listed:
  • Greg Bremner

    () (Dundee Business School, University of Abertay Dundee)

  • Rod Cross

    () (Department of Economics, University of Strathclyde)

Abstract

The World Bank has published estimates of sustainability of consumption paths by adjusting saving rates to take account of the depletion of non-renewable resources. During the period of North Sea oil production Scotland has been in a fiscal union with the rest of the UK. The present paper adjusts the World Bank data to produce separate genuine saving estimates for Scotland and the rest of the UK for 1970-2009, based on a 'derivation' principle for oil revenues. The calculations indicate that Scotland has had a negative genuine saving rate for most of the period of exploitation of North Sea oil resources, with genuine saving being positive in the rest of the UK during this period.

Suggested Citation

  • Greg Bremner & Rod Cross, 2012. "North Sea Oil and Genuine Saving in the Scottish Economy," Working Papers 1210, University of Strathclyde Business School, Department of Economics.
  • Handle: RePEc:str:wpaper:1210
    as

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    References listed on IDEAS

    as
    1. Hanley, Nick & Moffatt, Ian & Faichney, Robin & Wilson, Mike, 1999. "Measuring sustainability: A time series of alternative indicators for Scotland," Ecological Economics, Elsevier, vol. 28(1), pages 55-73, January.
    2. P J Forsyth & J A Kay, 1980. "The economic implications of North Sea Oil Revenues," Fiscal Studies, Institute for Fiscal Studies, vol. 1(3), pages 1-28, July.
    3. Frederick van der Ploeg, 2011. "Natural Resources: Curse or Blessing?," Journal of Economic Literature, American Economic Association, vol. 49(2), pages 366-420, June.
    4. Hartwick, John M, 1977. "Intergenerational Equity and the Investing of Rents from Exhaustible Resources," American Economic Review, American Economic Association, pages 972-974.
    5. Alexander G. Kemp & Linda Stephen, 2005. "Optimizing Oil and Gas Depletion in the Maturing North Sea with Growing Import Dependence," Oxford Review of Economic Policy, Oxford University Press, vol. 21(1), pages 43-66, Spring.
    6. Ragnar Torvik, 2009. "Why do some resource-abundant countries succeed while others do not?," Oxford Review of Economic Policy, Oxford University Press, vol. 25(2), pages 241-256, Summer.
    7. Harold Hotelling, 1931. "The Economics of Exhaustible Resources," Journal of Political Economy, University of Chicago Press, vol. 39, pages 137-137.
    8. 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.
    9. Geir B. Asheim, 1986. "Hartwick's Rule in Open Economies," Canadian Journal of Economics, Canadian Economics Association, vol. 19(3), pages 395-402, August.
    10. Hamilton, Kirk, 1994. "Green adjustments to GDP," Resources Policy, Elsevier, vol. 20(3), pages 155-168, September.
    11. Pearce, David W. & Atkinson, Giles D., 1993. "Capital theory and the measurement of sustainable development: an indicator of "weak" sustainability," Ecological Economics, Elsevier, vol. 8(2), pages 103-108, October.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Genuine savings; Adjusted net savings; North Sea oil; Derivation principle;

    JEL classification:

    • Q32 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Exhaustible Resources and Economic Development
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures

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