Complementarity, impatience, and the resilience of natural-resource-dependent economies
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In: Journal of Environmental Economics and Management, Vol. 66, No. 1, 01.07.2013, p. 15-32.
Research output: Journal contributions › Journal articles › Research › peer-review
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TY - JOUR
T1 - Complementarity, impatience, and the resilience of natural-resource-dependent economies
AU - Quaas, Martin Friedrich
AU - van Soest, Daan P.
AU - Baumgärtner, S.
PY - 2013/7/1
Y1 - 2013/7/1
N2 - 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.
AB - 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.
KW - Sustainability sciences, Management & Economics
KW - Resilience
KW - substitutes and complements
KW - discounting
KW - multiple steady states
KW - natural resources
KW - path dependence
KW - regime shifts
KW - tipping points
KW - Discounting
KW - Multiple steady states
KW - Natural resources
KW - Path dependence
KW - Regime shifts
KW - Resilience
KW - Substitutes and complements
KW - Tipping points
UR - http://www.scopus.com/inward/record.url?scp=84880599521&partnerID=8YFLogxK
U2 - 10.1016/j.jeem.2013.02.001
DO - 10.1016/j.jeem.2013.02.001
M3 - Journal articles
AN - SCOPUS:84880599521
VL - 66
SP - 15
EP - 32
JO - Journal of Environmental Economics and Management
JF - Journal of Environmental Economics and Management
SN - 0095-0696
IS - 1
ER -