The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Exhaustible Resources

  • Geoffrey Heal
Reference work entry


This article provides a brief overview of the ideas that have emerged in economics in connection with exhaustible resources. A resource is exhaustible if, the more we consume today, the less will be available for consumption at later dates. The dynamics of resource allocation, and the attainment of efficiency in intertemporal models, are thus key aspects of any economic theory of exhaustibility. The exhaustibility paradigm is widely applicable, including to climate change, biodiversity loss and even such non-environmental phenomena as antibiotic resistance.


Biodiversity Calculus of variations Capital–resource ratio Certainty-equivalence theorem CES production function Climate change Cobb–Douglas function Control theory Depletion Discount rate Exhaustible resources Hamiltonians Hartwick rule Hotelling model Hotelling rule Imperfect competition Intertemporal substitutability Neoclassical growth model Resource rent Shadow prices Sustainability 

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© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Geoffrey Heal
    • 1
  1. 1.