Professional Documents
Culture Documents
The Allocation
of Depletable
and Renewable
Resources:
An Overview
Introduction
This chapter presents the topic of resource
scarcity within the general taxonomy of
resources.
This chapter studies the implications of both
efficient and profit-maximizing decisionmaking.
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Objectives
Introduce natural resource economics.
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A Resource Taxonomy
A resource taxonomy is a classification
system used to distinguish various categories
of resource availability.
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FIGURE 7.1
A Categorization of Resources (1 of 2)
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FIGURE 7.1
A Categorization of Resources (2 of 2)
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FIGURE 7.1
A
Categorization
of Resources
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The vertical distance between the two equals the marginal user
cost. The horizontal axis measure time.
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Market Allocations
Appropriate Property Right Structures
Markets will behave well as long as the
property-rights structures governing the
resources are exclusive, universal,
transferable and enforceable.
A resource governed by a well-defined
property rights structure will then have both a
use value and an asset value to its owner.
Copyright 2009 Pearson Addison-Wesley. All rights reserved.
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Environmental Costs
The inclusion of environmental costs would
result in higher prices
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Summary
Efficient allocation of depletable and
renewable resources
Increasing marginal-cost
Technological progress
Market allocations
Property rights
Environmental costs
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