Sources of Economic Growth in Models with Non-Renewable Resources

Richard M. H. Suen and Hongsilp Sriket

No 19/12, Discussion Papers in Economics from Division of Economics, School of Business, University of Leicester

Abstract: This paper re-examines the possibility of endogenous long-term economic growth in neoclassical models with non-renewable resources. Instead of using a Cobb-Douglas production function as in most existing studies, we consider a general form in which physical capital is functionally separable from labour and natural resources. It is shown that if the elasticity of substitution between labour and resources is identical to one, then long-term economic growth is endogenous. But if this elasticity is not equal to one, as suggested by empirical studies, then long-term economic growth is entirely driven by an exogenous technological factor.

Keywords: Non-Renewable Resources; Endogenous Growth; Elasticity of Substitution (search for similar items in EconPapers)
JEL-codes: O13 O41 Q32 (search for similar items in EconPapers)
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Related works:
Journal Article: Sources of economic growth in models with non-renewable resources (2022)
Working Paper: Sources of Economic Growth in Models with Non-Renewable Resources (2019)
Working Paper: Sources of Economic Growth in Models with Non-Renewable Resources (2019)
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