Growth on a Finite Planet: Resources, Technology, and Population in the Long Run

We study the interactions between technological change, resource scarcity and population dynamics in a Schumpeterian model with endogenous fertility. We find a pseudo-Malthusian equilibrium in which population is constant and determined by resource scarcity while income grows exponentially. If labor and resources are substitutes in production, income and fertility dynamics are self-balancing and the pseudo-Malthusian equilibrium is the global attractor of the system. If labor and resources are complements, income and fertility dynamics are self-reinforcing and drive the economy towards either demographic explosion or collapse. Introducing a minimum resource requirement per capita, we obtain constant population even under complementarity.

"Growth on a Finite Planet: Resources, Technology, and Population in the Long Run" 
Economic Research Initiatives at Duke (ERID) Working Paper No. 147

PIETRO F. PERETTO, Duke University - Department of Economics
Email: PERETTO@ECON.DUKE.EDU
SIMONE VALENTE, NTNU
Email: simone.valente@svt.ntnu.no

Book: pp. 130-137.

Starring Earth Economics

Lisbon Book Launch

The Lisbon book launch of Earth Economics will focus on fragmentation which is one of the major drivers of the political context that gives rise to new forms of economic diplomacy.

May 23, 1800
Instituto Superior de Ciências Sociais e Políticas
Rua Almerindo Lessa - 1300-663, Lisboa
Sala 3, Piso 3

Peter Bergeijk é Professor Catedrático em Economia Internacional e Macroeconomia no International Institute of Social Studies, Universidade Erasmus de Roterdão. No passado, foi Chief Trade Economist no Ministério Negócios Estrangeiros Holandês, entre outros cargos no sector privado, público e na academia. Entre as suas publicações mais recentes destacam-se Economic Diplomacy and the Geography of International Trade (Edward Elgar, 2009), The gravity model in international trade (Cambridge University Press, 2010; co-eds.), The Economic Effectiveness of Diplomatic Representation (The Hague Journal of Diplomacy, 2011) e Economic diplomacy, trade and developing countries (Cambridge Journal of Regions, Economy and Society, 2011), ou Earth Economics (Edward Elgar, 2013).

Lenin could be wrong

"It is therefore impossible to conceive a capitalist nation without foreign trade, nor is there any such nation" - Vladimir Ilyich Lenin The DEVELOPMENT of CAPITALISM in RUSSIA, Chapter I. The Theoretical Mistakes of the Narodnik Economists, VIII. Why Does the Capitalist Nation Need a Foreign Market?

IMF's optimism

Forecasts for 2012 GPP growth adjusted in 11
editions of the World Economic Outlook
(April 2008-April 2013)

The latest edition of the IMF World Economic Outlook foresees a three speed recovery. In 2011 it foresaw a two speed recovery. The difference is mainly that Europe drags on, but at the same time the growth rates for the other continents although still in positive territory have been scaled down a bit. This scaling down is not typical for the present outlook. The figure shows the predictions that the IMF provided for GPP growth in 2012 in 11 different editions of the world economic outlook. Before the crisis broke out the expectation for world growth in 2012 was about 5% and the crisis reduced that outlook by half a percentage point only. It took untill october 2011 before the Fund started to adjust the prediction significantly and it took three editions to come close for the April 2013 estimate for 2012 (this is still an estimate and it may change a little bit).

Book: Text Box 1.2, p. 6.

Book Launch Earth Economics

Institute of Social Studies, The Hague

Kortenaer Kade 12
16.00 (cocktails afterwards)

Eartheconomics: An alternative introduction

This paper  sets out the didactical and logical arguments for using  the closed economy concept at the start of introductory courses to discuss our planet’s economy. The paper illustrates how observations at the level of planet Earth can be used while teaching relationships that are studied in a closed economy setting. It provides an overview of internet resources with world data and some practical examples that can readily be used in teaching.

Book: pp. 1-8, 11-18 (updated tables), 71-72 (exercise 6.5) and 126-128 (exercise 10.7)