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Questions tagged [resource-economics]

Natural resource economics deals with the supply, demand, and allocation of natural resources.

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Is Malthusian theory of population growth being realized?

You probably are familiar with Malthus' Theory of Population Growth. If you are not, Malthusian model has the following mathematically form: $$P(t) = P_0e^{rt}$$ A basic graphic representation is: ...
TelKitty's user avatar
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14 votes
5 answers
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The supply and demand of Virtual Products

We know that the fundamental economic problem is scarce resources relative to unlimited wants. **Does this apply to apps and Ebooks?**They are essentially virtual products who have in theory have ...
Surya Shyam's user avatar
12 votes
5 answers
965 views

What is the reasoning behind the sharp fall of oil prices starting in mid 2014?

Things I have considered: Poor economic conditions around the world could have caused an unpredicted decrease in demand. The resulting surplus has begun driving prices down. This could be ...
123's user avatar
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11 votes
3 answers
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Can the stock market show indefinite exponential growth?

In a comments on a question on money.SE, the following dialog took place: Eventually there will not be enough matter to represent all the money, so we know for certain that the answer is "No" for a ...
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8 votes
3 answers
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What is the impact of fracking on oil prices?

I read an article about the recent fall of gas prices in the US claiming that the fall in gas prices was due to the expansion of fracking within the US. The article said that, over the past few ...
Mathematician's user avatar
7 votes
1 answer
702 views

How successful will OPEC's predatory dumping strategy be?

Since the fracking industry in the US has started to grow rapidly, I have heard increasing reports that OPEC is attempting some form of predatory dumping in the hopes of making the fracking industry ...
Mathematician's user avatar
5 votes
1 answer
665 views

Is the income derived from owning a live animal profit or rent?

Natural resources are considered non-produced and yield rents, including land and the fruits of the land, e.g. trees. Does this extend to live animals? Or are live animals considered “produced” goods (...
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5 votes
1 answer
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Allocative efficiency -- correlation between MB and p in populace with wealth inequality

I was reading a paragraph in an economics textbook that was talking about resource allocation, and felt that it missed an important point, leading to a conclusion that I disagreed with. I was hoping ...
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3 answers
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What oil price will minimise new resource extraction?

A higher oil price would increase incentives to develop new oil resource extraction, but it also increases the competitiveness of sustainable energy sources. Conversely, a low oil price might mean ...
gerrit's user avatar
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4 votes
1 answer
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Constant Returns in a Production Function $\frac{Y}{L}=\left(\frac{K}{L}\right)^{\alpha}\left(\frac{R}{L}\right)^{\beta}$ ($R$ = Resource)

In his 1977 article (from which has developed a considerable literature on the Hartwick Rule for maintaining long-term constant consumption given depletion of non-renewable natural resources), ...
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4 votes
1 answer
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Australia and Saudi Arabia - Structural Similarities

I refer specifically to this article in which Andrew Critchlow paints a pretty dire view of the Australian economy. The line which challenged my priors was: ...
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4 votes
2 answers
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How helpful is Hotelling's Rule in determining the price of oil?

After posting this question, I realized that there was quite a bit of controversy surrounding the use of Hotelling's Rule to estimate the price of oil. Participants on this site seemed to be evenly ...
Mathematician's user avatar
4 votes
1 answer
289 views

Extraction and royalty time path for a non-renewable resource under a monopolist assumption

I am trying to understand the time path of extraction and royalty (price) for a non-renewable resource under a monopolist framework. The problem is that in the main books on environmental/resource ...
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4 votes
2 answers
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Definition: Extractive Goods (Comtrades HS-Categorization)

I'm currently writing a paper on China in Africa and I'd like to compare Africas Exports to China with its exports to Europe and the USA. More specifically I'd like to find out if the Exports to China ...
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3 votes
3 answers
812 views

Interpretation of the growth rate of consumption in a simple one-good model

In Perman et al. "The efficient and optimal use of natural resources" it is presented a simple single-good model of welfare dynamic optimisation with non-renewable natural resource where: Obj: $$ max ...
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3 votes
1 answer
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If Y=K+C, why the value of a marginal unit of capital is the same of the value of a marginal unit of output?

In a simple model of welfare dynamic optimisation with non-renewable natural resource where: $$ \dot S_t = -R_t $$ $$ \dot K_t = Q(K_t,R_t)-C_t $$ one of the first order condition is that $P_t=\...
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3 votes
1 answer
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Oil as a function of GDP

In Mankiw, N. (2012). Principles of Macroeconomics (6th ed.)., on pg 456 Mankiw says "The amount of oil used to produce a unit of real GDP has declined about 40 percent since the OPEC shocks of the ...
Jason Nichols's user avatar
3 votes
1 answer
142 views

Is weak sustainability (Hartwick's rule) possible on a global scale?

Hartwick's rule postulates that an economy is sustainable if all rents obtained from the extraction of non-renewable resources are re-invested in produced capital (Source). A typical example would be ...
sba222's user avatar
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2 votes
2 answers
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What would happen to the world GDP if we run out of minerals to mine but not of sources of energy?

I was thinking about how the depletion of minerals (metals and all material we mine from the Earth) will affect the GDP of the world. I read somewhere that at the current extraction rate, we will run ...
Abanob Ebrahim's user avatar
2 votes
1 answer
60 views

What's an example of a resource, raw material that has become scarce?

I'm interested in the elasticity price demand that predicts that as a resource becomes more scarce, it gets more expensive. Regarding oil price this isn't clear. Is there an example of a resource ...
Paul Boosz's user avatar
2 votes
1 answer
145 views

Hotelling rule and the shadow prices in a peg

Hotelling rule states that at equilibrium $$\frac{\dot p(t)}{p(t)} = i$$ Meaning that rate of change of the price at time $t$ should be equal to $i$, the interest rate. Assume that the government ...
Kuantew's user avatar
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2 votes
0 answers
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Which are the principal economic barriers to a circular economy?

The discussion usually revolves around issues such as product design, cultural awareness, etc. I wonder what the fundamental economic barriers are. I see a fundamental issue e.g. in transaction costs ...
sba222's user avatar
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1 vote
1 answer
58 views

What is the economic nature of water?

How should one classify water in economic terms? Is it a commodity, a natural resource, can it be both? Does it depend on how it is being used (e.g., as input/raw material in some process)? I was ...
flen's user avatar
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1 vote
1 answer
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What is the relationship between the disciplines of Economics and Economic Geography?

Given the importance of natural resources in both Economic Geography and Ecological Economics I also wondered what the relationship was between these two in particular.
sba222's user avatar
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1 answer
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Is anyone familiar with the following basic resource sharing model?

Here is a resource sharing model, I do not remember where I came across it, I am wondering if this is well known in econometrics. Let $T > 0$ be the total quantity of resources. For example, ad ...
Curaçao Hajek's user avatar
1 vote
0 answers
20 views

What would the price of carbon emissions need to be for the EU to achieve its objective to be carbon neutral by 2050?

The EU committed to net zero green house emissions by 2050. (Source) It is regularly said that the a carbon tax of USD 40-80 / t CO2e (USD 50-100 by 2030) would be sufficient to reach the Paris ...
sba222's user avatar
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1 vote
1 answer
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Optimal population allocation layout over the Earth

Does exist some model of optimal people occupancy over whole our planet? Something accounting for climate, resources (with and without existing settlements) availability, progress and grows ...
SerG's user avatar
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0 votes
2 answers
155 views

Is the use/consumption of natural resources considered an externality per se?

On a finite planet natural resources are rival goods by definition, i.e. if one agent uses/consumes a natural resource it becomes unavailable for other agents. Mankiw defines an externality as "the ...
sba222's user avatar
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0 votes
1 answer
133 views

What would Russia gain economically speaking if it conquered Ukraine?

Russia seems to take preparations for an invasion of Ukraine. Would Russia get richer or economically more powerful if it managed to annex ukraine? If so, in what ways? On the one hand Ukraine has a ...
Maurice's user avatar
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1 answer
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Subsidies as incentives

The given explanation about how subsidies unintentionally can result in resources being wasted does make sense to me. However, I just wanted a second opinion on my take on this. To me, it seems like a ...
Sahaj's user avatar
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0 votes
2 answers
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What are exactly considered resources in modern economics?

I'm taking a basic course in economics and I'm trying to understand what the term "resources" really mean in this context. Reading this article, I found out that in classical economics, resources are ...
Gabriele Scarlatti's user avatar
0 votes
2 answers
283 views

When does the law of diminishing returns apply?

Law of diminishing returns does not always apply: The law of diminishing returns states that in all productive processes, adding more of one factor of production, while holding all others constant, ...
Volker Siegel's user avatar
0 votes
1 answer
61 views

What is the name for Malthusian trap in techonology?

In his book “Work - A Deep History, from the Stone Age to the Age of Robots” James Suzman explains that recurrently; a society’s agricultural output was diluted due to population growth, (this is ...
Chicago1988's user avatar
0 votes
0 answers
36 views

Modelling the optimal mix of labour

I am trying to model the profit maximization decision of a firm that uses two types of labor, workers A and workers B. I started by drawing the marginal product and marginal cost curves (lines, for ...
Mikhail's user avatar
0 votes
0 answers
21 views

Proportion of time non-renewables determine the price of electricity price

I have a long time-series dataset of electricity generation over a period, broken down by generation type renewable and non renewable. I want to determine the percentage of time that non-renewables ...
Peter Raindeit's user avatar
0 votes
1 answer
81 views

Have the stocks and flows of hunter-gatherer economies been formally analysed?

A lot of work in economic anthropology seems to be about allocation mechanisms. This feeds into economic discourses about the institutions governing markets and non-market alternatives, e.g. Douglas ...
sba222's user avatar
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-1 votes
1 answer
54 views

Would a zero-growth economy with zero-growth population still have the same GDP?

If a country was to turn to a steady-state economy (or circular economy) where there is neither economic nor population growth with time, and there is no natural resources being added to the system ...
Abanob Ebrahim's user avatar
-1 votes
1 answer
52 views

Is there anything wrong with the idea that resource depletion causes recessions? [closed]

Just wondered if anyone has considered this. And any problems with the idea. Such as another theory.
john's user avatar
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-3 votes
1 answer
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Is there any evidence for tragedy of the commons or is it all actually the tragedy of private ownership?

The tragedy of the commons is sold as the idea that common property is over used, and thus arguments are made that there should be regulations over the commons, or it should be owned privately, ...
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