Sophia Masciarelli

The Bet Reading and Related Materials Questions

Energy & Sustainability
Due 02.27.17

1. What was the bet based on?

The bet was based on the idea that as human population grows, more stress is going to
be placed on our resources (both renewable and nonrenewable). The bet insinuates that
either a) some resources are going to become increasingly less plentiful (and therefore
more expensive) or b) population growth is not going to have any major impacts on
resource availability (therefore making them cost the same, or even less)

2. Why do you think Ehrlich and his colleagues chose those items to bet on? Why did they think
the price of those items would go up over a 10-year period?
These items were likely chosen because of their key importance in many of our
manufactured goods (cars, electronics, and buildings). Ehrlich believed that as
population grew and more people demanded more products, we would begin to run out--
thus raising prices.

3. Are the items they chose to bet on essential to life?

While these items are not essential to life, they certainly play an essential role in our
current lifestyle. They each play an important role in life as we know it today, but life
would go on without them.

4. Use this site http://www.indexmundi.com/commodities/ to check the price history of the

commodities that were used in this bet in more recent times. List each of the commodities, their
price 10 years ago and their price today.

Commodity Price 10 years ago Price today (in index

(in index number) number)

Commodity Agricultural Raw Materials 116.10 119.39

Index

Commodity Beverage Price Index 117.71 159.53

Commodity Fuel (energy) Index 102.36 101.96

Commodity Price Index 112.97 117.16

Commodity Food and Beverage Index 114.94 152.97

Commodity Industrial Inputs Index 147.85 133.22

Commodity Metals Index 170.78 143.21

Commodity Non-fuel Index 131.11 143.15

Crude Oil (Petroleum) 100.52 100.85

Commodity Food Index 114.20 152.26

5. Who would have won the bet if the 10-year period that was chosen ended today?
 Sophia Masciarelli
The Bet Reading and Related Materials Questions
Energy & Sustainability
Due 02.27.17

If the bet ended today, Julian Simon still would have won. While the price of metals
fluctuated throughout the years, it is cheaper now than it was in 2007. Other commodities
varied in the 10 year period; with some cheaper and some much more expensive than a
decade ago.

6. What does Dr. Sabin, writing in the New York Times about the bet, think that Paul Ehrlich and
the environmentalists that support him missed about Simons position?
Dr. Sabin points out that a simple linear (abundance to scarcity) bet such as this does
very little to illustrate anything about environmental threats. He argues that the outcome
was lucky, and in a simulation would have projected the same outcome about 6 out of 10
times. He argues that this bet is not indicative of the way markets for natural resources
function. There is rarely a simple linear path from abundance to scarcity. says Sabin.

7. What does Dr. Sabin think that the more conservative forces that support Julian Simons
position did not understand about Paul Erlichs position?
Dr. Sabin explains that these conservative forces may not be taking into account the
reality in which our Earth is being subjected to; how simple looking at the way prices of
miscellaneous commodities fluctuate is not indicative of the changes that are occurring.
The price changes are more likely a result of a variety of macroeconomic factors rather
than the state of the planet.

8. What commodities do you expect will be much more costly 10 years from now? Why?
I predict that many natural resources which are used in technology and manufactured
goods will begin to become less abundantly available (and therefore more expensive) as
a result of the worldwide shift into a technological era.