Economics of natural resource scarcity : the state of the debate

Abstract

Whether economic growth can be sustained in a finite natural world isone of the earliest and most enduring questions in economic literature. Even with unprecedented growth in human population and resource consumption, humans have been quite adept at finding solutions to the problemof scarce natural resources, particularly in response to signals of increased scarcity. Because environmental resources generally are not generally traded on markets, however, scarcity signals for these resources may be inadequate, and appropriatepolicy responses are difficult to implement and manage. In the debate over the economic scarcity of natural resources, one significant change in recent years has been a greater focus on the ecosystemservices and the resource amenities yielded by natural environments. The general conclusion ofthis paper is thattechnological progress has ameliorated thescarcity ofnatural resource commodities; but resource amenities have becomemore scarce,and it is unlikely that technology alone can remedy that.