nep-res New Economics Papers
on Resource Economics
Issue of 2004‒12‒20
three papers chosen by
Maximo Rossi
Universidad de la República

  1. A Generalized Hybrid Approach to Controlling Emissions By Mandell, Svante
  2. Productivity Trends in the Gold Mining Industry in Canada By Jeremy Smith
  3. The Growth of Diamond Mining in Canada and Implications for Mining Productivity By Jeremy Smith

  1. By: Mandell, Svante (Dept. of Economics, Stockholm University)
    Abstract: This paper examines the optimal instrument choice to control emissions under uncertainty. A hybrid regulation mechanism is developed that contains cap-and-trade, emissions taxes and socalled safety valves as special cases. This makes it possible to examine optimal policy choice and the resulting efficiency losses for each instrument. It is shown that the hybrid regulation mechanism in efficiency terms is weakly superior to the other instruments. The model is also used to study optimal response to non-optimal policy implementations.
    Keywords: Emissions tax; Emissions trading; Safety valve; Ranking; Uncertainty
    JEL: H23 Q28 Q58
    Date: 2004–11–10
  2. By: Jeremy Smith
    Abstract: The purpose of this report is to uncover the factors behind what has been, on average, a strong productivity performance from the Canadian gold mining industry over the past four decades. It is found that real price movements have had a substantial impact on productivity growth in the gold mining industry in Canada. The real price of gold declined steadily throughout the 1990s, squeezing the profits of mines on sites of marginal quality and thereby leading to the closure of the least productive gold mines. This had the effect of increasing the average productivity of the overall industry. The report also finds evidence that the gold mining industry in Canada was not in good health towards the end of the 1970s, despite the record gold prices of this period. Real gold mining output decreased sharply and steadily throughout the 1960s and 1970s, despite massive capital accumulation. This situation was reversed in the 1980s, with new discoveries of gold, and strong productivity growth driven by technological and organizational improvements. As these observations suggest, the productivity performance of the Canadian gold mining industry has been markedly different from decade to decade. The 1960s and 1970s witnessed productivity stagnation followed by sharp declines, but the 1980s and 1990s saw gold mining productivity growth exceeding that at the total economy level by a wide margin. Overall, the productivity gains of the past two decades have more than offset the earlier poor performance, so that the average productivity record of the gold mining industry over the past four decades remains strong.
    Keywords: Gold Mining, Gold Industry, Mining, Mining Industry, Canada, Productivity, Productivity Growth
    JEL: L72 J24 D24
    Date: 2004–10
  3. By: Jeremy Smith
    Abstract: Diamond mining in Canada began in 1998, with the first production from the Ekati mine in the Northwest Territories. Since then the Diavik mine has begun production, and two other mines are slated to begin production within two years. Canada’s share of the world value of diamond production was 15 per cent in 2003, the third largest worldwide. These mines are all located in the northern regions of Canada, and hence contribute substantially to the growth of these regions. Diamond production accounted for 19.9 per cent of total real output in the Northwest Territories in 2002, representing a phenomenal impact, especially given that the industry did not exist five years before. Given the very high level of output per hour in the diamond mining industry – reflecting a high degree of economic rent – and the strong expected growth of the industry in the coming years, the labour productivity growth of the overall mining industry will be favourably affected. Based on a rough simulation of the growth of the Canadian diamond mining industry in the 2001-2006 period, average annual labour productivity growth in the overall mining industry will be between one and two percentage points higher than if the diamond mining industry did not exist. Although the mining of rough diamonds is lucrative in itself, there is also much value added in the manufacture and retailing of diamond jewelry. Investment by Canadian firms in each stage of the diamond pipeline could promise large returns due to the very high value added associated with the overall diamond industry.
    Keywords: Diamonds, Diamond Mining, Canadian Diamonds, Diamond Industry, Productivity, Mining Productivity, Mining Industry, Canada, Northwest Territories
    JEL: L72 J24
    Date: 2004–10

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