Sustainable growth in a resource-based economy: the extraction-saving relationship

Bazhanov, Andrei (2008): Sustainable growth in a resource-based economy: the extraction-saving relationship.

Abstract

The paper presents two new results for the Dasgupta-Heal-Solow-Stiglitz model with an essential nonrenewable resource:

(1) the pattern of resource extraction can be more important for sustainable growth than the pattern of saving when the Hotelling Rule modifier is not small enough;

(2) the qualitative behavior of the long-run per capita output can be examined along any smooth enough path of extraction for any variable saving rate using the "index of sustainable extraction" introduced in the paper.

• Item Type: MPRA Paper
• Language: English
• Keywords: modified Hotelling Rule; imperfect economy; sustainable growth; index of sustainable extraction; Hubbert curve consumption
• Subjects: Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q3 - Nonrenewable Resources and Conservation > Q38 - Government Policy; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q3 - Nonrenewable Resources and Conservation > Q32 - Exhaustible Resources and Economic Development; O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O47 - Empirical Studies of Economic Growth ; Aggregate Productivity ; Cross-Country Output Convergence; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O13 - Agriculture ; Natural Resources ; Energy ; Environment ; Other Primary Products

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