Handbook on the Economics of Natural Resources
Show Less

Handbook on the Economics of Natural Resources

Edited by Robert Halvorsen and David F. Layton

The topics discussed in the Handbook on the Economics of Natural Resources are essential for those looking to understand how best to use and conserve the resources that form the foundation for human well-being. These include nonrenewable resources, modeling of biological resources, conservation of biological resources and water resources. The expert contributors of this Handbook provide solutions to many of the problems that growing populations now face, and sketch the likely future developments in the field of natural resource economics whilst paving the way for new thinking.
Buy Book in Print
Show Summary Details
You do not have access to this content

Chapter 3: Empirical evidence on the theory of nonrenewable resource economics

John Livernois and Henry Thille


The literature on the economics of nonrenewable resources has focused on modeling the long-run dynamic behavior of nonrenewable resource firms and the associated implications for markets. At the heart of the literature lies an analysis of the behavior of scarcity rent over time because of its central role in the determination of depletion and price profiles. True, market prices for nonrenewables are determined by the usual myriad of supply-side and demand-side factors, but the one factor that sets nonrenewable resource price determination apart from that in other markets is scarcity rent. Consequently, the determinants and behavior of scarcity rent has dominated the literature and captured the attention of economists. Theory predicts that scarcity rent rises at the rate of interest in the basic Hotelling (1931) model and rises less rapidly when extraction cost rises with depletion.

You are not authenticated to view the full text of this chapter or article.

Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.

Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.

Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.

Further information

or login to access all content.