Sources of Economic Growth in Models with Non-Renewable Resources
Hongsilp Sriket () and
Richard M. H. Suen ()
MPRA Paper from University Library of Munich, Germany
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 class of production functions 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 bounded above or below by one, as suggested by empirical evidence, then long-term economic growth is determined a priori 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)
New Economics Papers: this item is included in nep-ene, nep-env and nep-gro
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:96243
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