Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
10475594 | Journal of Environmental Economics and Management | 2013 | 18 Pages |
Abstract
We study how society's preferences affect the resilience of economies that depend on more than one type of natural resource. In particular, we analyze whether the degree of complementarity of natural resources in consumer preferences may give rise to multiple steady states and path dependence even when resources are managed optimally. We find that, for a given social discount rate, society tends to be less willing to buffer exogenous shocks if resource good are complements in consumption than if they are substitutes. The stronger the complementarity between the various types of natural resources, the less resilient the economy is, and even more so the higher is the social discount rate.
Keywords
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Martin F. Quaas, Daan van Soest, Stefan Baumgärtner,