Abstract
The Bureau of Economic Analysis (BEA), U.S. Department of Commerce, in keeping with broad international efforts to “green” national gross domestic product (GDP) accounts, has attempted to create satellite accounts for mineral depletion. The present paper criticizes the BEA's unit rent measure of resource depletion, which is based upon Hotelling's pure theory of exhaustion. Following a thorough criticism of Hotelling's theory as a real-world model of mineral prices, practical issues related to the treatment of recycling, exploration, definition of reserves/resources, and their valuation/exploitation are introduced. For crude oil and natural gas and the nonfuel minerals, specific application problems of joint products and residuals complicate BEA's assumptions and efforts.
Similar content being viewed by others
References
Adelman, M. A., 1986a, Scarcity and world oil prices: Review of Economics and Statistics, v. 68, no. 3, p. 387–397.
Adelman, M. A., 1986b, The competitive floor to world oil prices: The Energy Journal, v. 7, no. 4, p. 9–32.
Adelman, M. A., 1991, Oil fallacies: Foreign Policy no. 82, Spring, p. 2–16.
Adelman, M. A., and Watkins, G. C., 1995, Oil and gas reserve values in the USA: Newsletter, International association of energy economists, Summer, p. 24–25, 29.
Bahree, B., 1995, BP comes back even as oil prices sink: The Wall Street Journal, Sept. 8, p. A8.
Barnett, H. J., 1979, Scarcity and growth revisited,in Smith, V. K., ed., Scarcity and growth reconsidered: Baltimore, The Johns Hopkins University Press, p. 163–217.
Barnett, H. J., and Morse, C., 1963. Scarcity and growth: The economics of natural resource availability: Baltimore, Johns Hopkins University Press.
Beck, R. J., 1993, U.S. oil and gas demand set to grow again in 1993: Oil and Gas Journal, v. 91, no. 4, p. 63.
Beck, R. J., and Williamson, M. 1995, OGJ100 companies dominate world reserves, production: Oil and Gas Journal, v. 93, no. 36, p. 74.
Brennan, T. J., 1995, Discounting the future: economics and ethics: Resources, Summer no. 120, p. 3–6, Washington, D.C., Resources for the Future.
Carson, C., 1995a, Integrated economic and environmental satellite accounts: Nonrenewable Resources, v. 4, no. 1, p. 12–33.
Carson, C., 1995b, Accounting for mineral resources: issues and BEA's initial estimates: Nonrenewable Resources, v. 4, no. 1, p. 34–59.
Hamilton, K., 1994, Green adjustments to GDP: Resources Policy, v. 20, no. 3, p. 155–168.
Harris, D. P., 1987, Mineral exploration and production costs and technologies—past, present, and future,in McLaren, D. J., and Skinner, B. J., eds., Resources and world development: New York, John Wiley & Sons, p. 423–442.
Harris, D. P., 1995, Mineral-resource assessment—Perspectives on past and present and speculation on future directions: Nonrenewable Resources, v. 4, no. 3, p. 213–232.
Harris, D. P., and Rieber, M., 1993, Evaluation of the United States geological survey's three-step assessment methodology: U.S. geological survey Open File Report 93-258, 673 p.
Herfendahl, O. C., 1967, Depletion and economic theory,in Gaffney, M., ed., Extractive resources and taxation: Madison Wisconsin, The University of Wisconsin Press, p. 63–90.
Heyes, A. G., and Liston-Heyes, C., 1995, Sustainable resource use: the search for meaning (Viewpoint): Energy Policy, v. 23, no. 1, p. 1–3.
Hotelling, H., 1931, The economics of exhaustible resources: Journal of Political Economy, v. 39, no. 2, p. 137–175.
McLaren, D. J., and Skinner, B. J., 1987, Resources and world development: Dahlem Workshops Reports, New York, John Wiley & Sons, 940 p.
Menzie, W. D., 1995, Public attitudes and policies towards mineral resources on the brink of the 21st century: Nonrenewable Resources, v. 4, no. 1, p. 1–11.
Mikesell, R. F., 1994, Sustainable development, and mineral resources (Viewpoint): Resources Policy, v. 20, no. 2, p. 83–86.
Nordhaus, W. D., 1973, The allocation of energy resources,in Brookings papers on economic activity, no. 3: Washington, D.C., Brookings Institution, p. 529–570.
Petroleum Press Service, 1993, Crude oil production costs, v. 33 (May 1966), 177–179; reprintedin M. A. Adelman, The economics of petroleum supply: Cambridge, The MIT Press, p. 59–63.
Repetto, R., Magrath, W., Wells, M., Beer, C., and Rossini, F., 1989, Wasting assets: Natural Resources,in The national accounts: Washington, D.C., World Resources Institute.
Rieber, M., 1995, From market commodity to toxic waste: the transit of mercury, preprint 95-255: Annual Meeting of the American Institute of Mining and Metallurgical Engineers, Denver, Colorado, March 5–6.
Rieber, M., and Harris, D. P., 1994, Mercury Pollution: The impact of U.S. government stockpile releases (Chap. VII.4),in Watras, C. J., ed., Mercury pollution: integration and synthesis: Boca Raton, Lewis Publishers, p. 615–619.
Simon, J. L., Weinrauch, G., and Moore, S., 1994, The reserves of extracted resources: Nonrenewable Resources, v. 3, no. 4, p. 325–340.
Smith, V. K., 1979, Scarcity and growth reconsidered: Baltimore, Johns Hopkins University Press, 298 p.
Smith, V. K., and Krutilla, J. V., 1982, Explorations in natural resource economics: Baltimore Johns Hopkins University Press, 352 p.
Stagliano, V. A., 1995, The ghost of OPEC in energy security policy: Resources, Resources for the Future p. 6–9.
United Nations, 1993, Integrated environmental and economic accounting: Series F, no. 61, New York.
United States Geological Survey, 1995, National assessment of United States oil and gas resources, U.S.G.P.O.: Circular 118, 20 p.
Wessel, D., 1995, World Bank ranking of nations' wealth puts Australia on top, the U.S. 12th: Wall Street Journal, September 18, p. A2.
Author information
Authors and Affiliations
Rights and permissions
About this article
Cite this article
Harris, D., Rieber, M. Commentary and critique of “accounting for mineral resources: Issues and BEA's initial estimates”. Nat Resour Res 5, 7–21 (1996). https://doi.org/10.1007/BF02259066
Received:
Accepted:
Issue Date:
DOI: https://doi.org/10.1007/BF02259066