EconPapers    
Economics at your fingertips  
 

Ordering the Extraction of Polluting Nonrenewable Resources

Ujjayant Chakravorty (), Michel Moreaux and Mabel Tidball ()

American Economic Review, 2008, vol. 98, issue 3, 1128-44

Abstract: A well-known theorem by Herfindahl states that the low-cost nonrenewable resource must be exploited first. Consider resources that are differentiated only by their pollution content. For instance, both coal and natural gas are used to generate electricity, yet coal is more polluting. We show that the ordering of extraction need not be driven by whether a resource is clean or dirty. Coal may be used first, followed by natural gas, and again by coal. Such "vacillation" does not occur under cost heterogeneity. A perverse policy implication is that regulating pollution may accelerate use of the polluting resource.

JEL-codes: Q32 Q38 Q53 Q58 (search for similar items in EconPapers)
Date: 2008
Note: DOI: 10.1257/aer.98.3.1128
References: Add references at CitEc
Citations: View citations in EconPapers (145)

Downloads: (external link)
http://www.aeaweb.org/articles.php?doi=10.1257/aer.98.3.1128 (application/pdf)
http://www.aeaweb.org/aer/data/june08/20060998_app.pdf (application/pdf)
Access to full text is restricted to AEA members and institutional subscribers.

Related works:
Working Paper: Ordering the Extraction of Polluting Nonrenewable Resources (2006) Downloads
Working Paper: Ordering the Extraction of Polluting Nonrenewable Resources (2006) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aea:aecrev:v:98:y:2008:i:3:p:1128-44

Ordering information: This journal article can be ordered from
https://www.aeaweb.org/journals/subscriptions

Access Statistics for this article

American Economic Review is currently edited by Esther Duflo

More articles in American Economic Review from American Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Michael P. Albert ().

 
Page updated 2025-04-17
Handle: RePEc:aea:aecrev:v:98:y:2008:i:3:p:1128-44