On the Portents of Peak Oil (And Other Indicators of Resource Scarcity)
RFF Academic Seminar
James Smith, Cary M. Maguire Chair in Oil and Gas Management, SMU Cox School of Business
Economists have studied various indicators of resource scarcity but largely ignored the phenomenon of “peaking” due to its connection to non-economic (physical) theories of resource exhaustion. I consider peaking from the economic point of view, where economic forces determine the shape of the equilibrium extraction path. Within that framework, I ask whether the timing of peak production reveals anything useful about scarcity. I find peaking to be an ambiguous indicator. If someone announced the peak would arrive earlier than expected, and you believed them, you would not know whether the news was good or bad. However, I also show that the traditional economic indicators of resource scarcity (price, cost, and rent) fare no better, and argue that previous studies have misconstrued the connection between changes in underlying scarcity and movements in these traditional indicators.
Tuesday, November 15, 2011
10:30 a.m. - 12:00 p.m.
Pastries and refreshments will be provided.
7th Floor Conference Center
1616 P St. NW
Washington, D.C. 20036
All seminars will be in the 7th Floor Conference Room at RFF, 1616 P Street NW. Attendance is open, but involves pre-registration no later than two days prior to the event. For questions and to register to an event, please contact Khadijah Hill at firstname.lastname@example.org (tel. 202-328-5174). Updates to our academic seminars schedule will be posted at www.rff.org/academicseminarseries.