Extraction path and sustainability

Andrei Bazhanov

Resources Policy, 2022, vol. 76, issue C

Abstract: This paper offers an approach to construct a family of extraction paths for nonrenewables that guarantee long-run sustainability of an imperfect economy. A path from this family leads to a monotonic growth of output with a decreasing rate of growth if a sustainability condition holds. Otherwise, the path leads either to a bounded decline or U-shaped path of output. In this sense, the paper extends neoclassical results and provides a bridge between neoclassical and degrowth theories because neoclassical tools are used to quantify degrowth scenarios. The offered path can be incentive-compatible for climate change problems because it reduces the extraction of polluting minerals consistently with the IPCC goals. That is, the climate-benefiting emission cuts by the parties of climate agreements may be guided by purely “egoistic” motives—to make own economies long-run sustainable.

Keywords: Natural nonrenewable resource; Extraction policy; Long-run sustainability; Optimal degrowth (search for similar items in EconPapers)
JEL-codes: Q01 Q32 Q38 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jrpoli:v:76:y:2022:i:c:s0301420722000174

DOI: 10.1016/j.resourpol.2022.102565

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