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Common and Private Property to Exhaustible Resources: Theoretical Implications for Economic Growth

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  • Kirill Borissov
  • Alexander Surkov

Abstract

We develop two models of economic growth with exhaustible natural resources and consumers heterogeneous in time preferences. The first model assumes private ownership of natural resources. In the second model, natural resources are commonly owned and the resource extraction rate is chosen by voting. We show that if discount factors are given exogenously, the long-run rate of growth under private property is higher than or equal to that under common property. If the discount factors are formed endogenously, under some circumstances common property can result in a higher rate of growth than private property.

Suggested Citation

  • Kirill Borissov & Alexander Surkov, 2010. "Common and Private Property to Exhaustible Resources: Theoretical Implications for Economic Growth," EUSP Department of Economics Working Paper Series 2010/02, European University at St. Petersburg, Department of Economics, revised 29 Sep 2010.
    • Handle: RePEc:eus:wpaper:ec2010_02
    Note: Presented at the Monte Verita Conference on Sustainable Resource Use and Economic Dynamics Ñ SURED 2010 (Ascona, Switzerland, June 7-10, 2010), the 2010 World Conference on Natural Resource Modeling (Helsinki, Finland, June 16-19, 2010) and the 11th Annual Conference of the Association for Public Economic Theory (PET10, Istanbul, Turkey, June 25-27, 2010).
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    References listed on IDEAS

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    Cited by:

    1. Kirill Borissov & Mikhail Pakhnin, 2018. "Economic growth and property rights on natural resources," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 65(2), pages 423-482, March.
    2. Kirill Borissov & Mikhail Pakhnin, 2018. "Economic growth and property rights on natural resources," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 65(2), pages 423-482, March.
    3. Susan Randolph & Patrick Guyer, 2011. "Tracking the Historical Evolution of States' Compliance with their Economics and Social Rights Obligations of Result: Insights from the Historical SERF Index," Economic Rights Working Papers 18, University of Connecticut, Human Rights Institute.

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    More about this item

    Keywords

    economic growth; taxation; voting;
    All these keywords.

    JEL classification:

    • Q32 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Exhaustible Resources and Economic Development
    • E13 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Neoclassical
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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