Natural Resource Economics An Introduction

Table of contents

Preface xiii

SECTION I. INTRODUCTION 1

1. Important issues in Natural Resource Economics 2
Natural Resource Adequacy 2
Socially optimal rates of resource use 7
Identifying the sources of Natural resource management 7
Preservation vs. Extraction: Valuation of Alternatives 9
Property rights and Natural Resources 11
The use of benefit-Cost Analysis in Natural Resource Decisions 14
Land use Issues 16
Natural Resource Accounting 18
International Natural Resource Conflicts 19
Natural Resources and Economic Development 21
Summary 23
2. Natural resource and the Economy 24
Some Technology 27
The Range of Natural Resource services 28
Modeling Resource Services 30
Some words about Economics 33
The political unit problem 35
Summary 37
SECTION II. BULDING BLOCKS 39

3. Willingness to pay/demand 41
Willingness to pay 41
Discounting 52
Summary 54
4. Cost /Supply 57
Opportunity Cost 57
Cost curves 58
The shape of cost curves 60
Marginal costs and supply 62
Present value of cost 65
Taxes and costs 66
Summary 67
5. Efficiency and sustainability 70
Static efficiency 71
Dynamic (Inter temporal) efficiency 73
Is it Appropriate to discount? 78
Efficiency and International Equity: The Issue of sustainability 82
Summary 84
SECTION III. GENERAL NATURAL RESOURCE ISSUES 87

6. Markets and efficiency 88
Market demand and supply 88
Markets and static social efficiency 98
Summary 101
7. Public policy for natural resources 103
The objectives of public policy 104
Types of public policies 107
Private property rights 110
Government –sponsored incentive policies 115
Direct controls 118
Direct public production 120
Market failure/Government failure 121
Policy centralization/Decentralization 123
Summary 124
SECTION IV. NATURAL RESOURCE ANALYSIS 127

8. Principle of Analysis 28
Impact Analysis 128
Cost-effectiveness Analysis 132
Benefit-cost Analysis 132
Summary 148
9. The valuation of natural resources 151
Measuring Benefits 152
Active (use) Benefits 153
Nonuse (Passive) Benefits 159
Measuring costs 163
Summary 168
SECTION V APPLID NATURAL RESOURCES PROBLEMS 172

10. Mineral Economics 173
Geological factors and cost of extraction 174
Extraction Economics for a known stock 176
Resource exploration and Development 182
Nonrenewable resources and sustainability 184
Minerals price in fact 186
U.S. Mineral import Dependence 188
Other policy issues 191
The Economics of recycling 192
Summary 196
11. Energy 199
Energy use in the United States: Consumption and Prices 200
The political Economy of energy markets 202
The question of energy Adequacy 204
The economics of energy self –sufficiency 205
Energy conservation 210
Economics of café standards 213
Economic issue in electricity Deregulation 215
Summary 219
12. Forest Economics 222
Forest Harvest decisions 224
Institutional Arrangements for forestry 237
Timber harvesting from National forests 238
Summary 239
13. Marine Resources 242
Current problems in marine fisheries 243
U.S. fisheries Management institutions 245
Modeling a Fishery 247
Efficiency rates of Effort 251
The problem of open access 253
Approaches to fisheries management 254
Uncertainty and fisheries management 261
Summary 262
14. Land Economics 265
Social Efficiency in Land use 267
Land markets and prices 269
Public policies and land use 271
Land-use Economics and the ‘’taking’’ Issues 277
Land rent and Price Gradients 279
The Economics of Urban sprawl 280
Land management Issues on the Urban/Rural Fringe 282
Land use in certain Environments 284
Managing Public lands 290
Summary 290
15. Water Resources 293
Water use in the United States 294
Water Law in the United States 296
Water pricing 300
Investing in water supply systems 304
Water rights transfers and Markets 306
In stream flow protection 314
Summary 316
16. Economics of agriculture 320
Historical changes in supply and demand 321
Income support policies in Agriculture 325
Wetland conservation 328
Economics of pesticide resistance 330
The Economics of monoculture 334
The Economic of soil productivity 336
Summary 338
17. Economics of outdoor Recreation 341
The Demand for outdoor recreation 343
Rationing use 347
Ecotourism 357
Summary 361
18. The Economics of Wildlife management 364
Wildlife ecology and Human Institutions 365
The Economics of sport Hunting 371
Wildlife in suburban areas 379
Distribution Issues in Restoration and Predator control 381
Public policy and wildlife markets 385
Summary 388
19. The Economics of Biodiversity preservation 391
The endangered species Act 392
The Noah problem 397
Cost-Effective Biodiversity preservation 404
Costs of diversity protection 409
Summary 413
SECTION VI. NATURAL RESOURCES IN DEVELOPING COUNRIES 416

20. Natural resources and Economic Growth 417
The Institutional/Demographic content 419
Resources and Growth: Two perspectives 420
How Economies grow 423
Natural Resource Accounting 426
The control and Management of Resource Rents 428
The volatility of resource rents in developing countries 432
Land Rents and Land Reform 433
Project evaluation 437
Summary 441
21. Natural Resource Decisions in Developing Countries 444
Incentives and Political power 446
Property rights 447
Deforestation 452
Soil erosion and soil Productivity 457
Local and Nonlocal resource interests 460
Summary 463

Index 467