New Economics Papers
on Resource Economics
Issue of 2010‒11‒06
six papers chosen by

  1. War and Natural Resource Exploitation By Rick van der Ploeg; Dominic Rohner
  2. Population Growth and Natural Resource Scarcity: Long run development under seemingly unfavourable conditions By Lucas Bretschger
  3. Precautionary Climate Change Policies and Optimal Redistribution By Bas Jacobs; Rick van der Ploeg
  4. Managing Natural Resources Revenue: The case of Chile By J Rodrigo Fuentes
  5. Environmental Policy and Public Debt Stabilization By Mouez Fohda; Thomas Seegmuller
  6. Have Government Spending and Energy Tax Policies Contributed to make Europe Environmentally Cleaner? By Lopez, Ramon E.; Palacios, Amparo

  1. By: Rick van der Ploeg; Dominic Rohner
    Abstract: Although the relationship between natural resources and civil war has received much attention, little is known about the underlying mechanisms. Controversies and contradictions in the stylized facts persist because resource extraction is treated as exogenous while in reality fighting affects extraction. We study endogenous fighting, armament, and extraction method, speed and investment. Rapacious resource exploitation has economic costs, but can nevertheless be preferred to balanced depletion due to lowered incentives for future rebel attacks. With private exploitation, rebels fight more than the government if they can renege on the contract with the mining company, and hence government turnover is larger in this case. Incentive-compatible license fees paid by private companies and mining investment are lower in unstable countries, and increase with the quality of the government army and office rents. This implies that privatised resource exploitation is more attractive for governments who have incentives to fight hard, i.e., in the presence of large office rents and a strong army. With endogenous weapon investments, the government invests more under balanced than under rapacious or private extraction. If the government can commit before mining licenses are auctioned, it will invest more in weapons under private extraction than under balanced and rapacious nationalized extraction.
    Keywords: conflict, natural resources, private resource exploitation, mining investment, license fee
    JEL: D45 D74 L71 Q34
    Date: 2010
  2. By: Lucas Bretschger
    Abstract: The paper considers an economy which is constrained by natural resource use and driven by knowledge accumulation. Resources are essential inputs in all the sectors. It is shown that population growth and poor input substitution are not detrimental but, on the contrary, even necessary for obtaining a sustainable consumption level. We find a new type of Hartwick rule defining the conditions for a constant innovation rate. The rule does not apply to capital but to labour growth, the crucial input in research. Furthermore, it relates to the sectoral structure of the economy and to demographic transition. The results continue to hold with a backstop technology and are extended for the case of minimum resource constraints.
    Keywords: Population growthm non-renewable resources, poor input substitution, technical change, sustainability
    JEL: Q32 Q55 Q56 O41
    Date: 2010
  3. By: Bas Jacobs; Rick van der Ploeg
    Abstract: We analyse optimal carbon taxes, optimal redistribution within and between non-overlapping generations, and optimal spending levels on climate abatement and adaptation. A positive probability of unexpected large increases in CO2 emissions results in a lower discount rate for global warming damages. More prudent governments set higher carbon taxes and spend more on abatement and sacrifice intra-generational for inter-generational redistribution. As long as households spend a constant fraction of their income on polluting goods, the carbon tax is not used for redistribution and is set at the modified Pigouvian rate, which is higher than the Pigouvian rate if governments are prudent. However, the carbon tax is set below the modified Pigouvian rate if poor households spend relatively more on polluting goods than rich households (Stone-Geary preferences). Policy simulations give insights into the effects of changes in the probability of climate disaster, degrees of intra- and inter-generational inequality aversion, ease of substitution between clean and dirty goods, elasticity of labour supply, productivity of abatement and adaptation, population growth and economic growth on the rates of discount, inequality, global warming and social welfare.
    Keywords: global warming, intra-generational and inter-generational redistribution, equally-distributed-equivalent utility, social discount rate, prudence, carbon tax, income tax, CO2 abatement, climate adaptation, non-homothetic preferences.
    JEL: H21 H23 Q54
    Date: 2010
  4. By: J Rodrigo Fuentes
    Abstract: Countries abundant in natural resources face the dilemma of how to manage this source of revenues. The recent boom in commodity prices put this issue at the top of the agenda in natural resource rich economies. Chile, for instance, is the largest copper producer in the world, supplying 43% of world copper exports. In 2007, the state-owned corporation, CODELCO, produced one third of total Chilean copper output and the revenues from its copper exports accounted for 16% of total fiscal revenues. In the past few years, the government has been under political pressure to distribute more of these revenues across different groups.
    Keywords: Chile, natural resources revenue, resource rich economies, CODELCO, copper
    JEL: Q32 O41
    Date: 2010
  5. By: Mouez Fohda (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I); Thomas Seegmuller (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - Université de la Méditerranée - Aix-Marseille II - Université Paul Cézanne - Aix-Marseille III - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - CNRS : UMR6579)
    Abstract: This article analyzes the consequences of environmental tax policy under public debt stabilization constraint. A public sector of pollution abatement is financed by a tax on pollutant emissions and/or by public debt. In the same time, households can also invest in private pollution abatement activities. We show that the economy may be characterized by an environmental-poverty trap if debt is too large or public abatement is not sufficiently efficient with respect to the private one. However, there exists a level of public abatement and debt for a stable steady state to be optimal.
    Keywords: Environmental taxation, public and private abatements, public debt, trap, optimality.
    Date: 2010–08–31
  6. By: Lopez, Ramon E.; Palacios, Amparo
    Keywords: Environmental Economics and Policy, Public Economics, Resource /Energy Economics and Policy,
    Date: 2010–10

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