The elephant in Hotelling's room
2011 (English)In: Energy Policy, ISSN 0301-4215, Vol. 39, no 12, 7834-7838 p.Article in journal (Refereed) Published
This paper questions the assumption, commonly used in theoretical and policy research, that scarcity rents make up a large proportion of market prices for oil and coal. We show that the empirical literature, simple calculations of historical and future scarcity rent shares, and possible theoretical explanations all imply the same overall conclusions: that scarcity rents seem to have been marginal or non-existent historically; that they almost certainly do not dominate fossil resource prices today; and that there will be other factors shaping the prices in the upcoming decades. We therefore argue that using the scarcity rent as the main or only basis for policy or for explaining empirical outcomes is ill-advised.
Place, publisher, year, edition, pages
2011. Vol. 39, no 12, 7834-7838 p.
Resource scarcity, Climate policy, Green paradox
Economics and Business Environmental Sciences
IdentifiersURN: urn:nbn:se:su:diva-74040DOI: 10.1016/j.enpol.2011.09.029ISI: 000298363400035OAI: oai:DiVA.org:su-74040DiVA: diva2:506704
authorCount :22012-02-292012-02-282012-10-18Bibliographically approved