Authors libby rittenberg 718

Renewable Natural Resources As is the case with exhaustible natural resources, our consumption of the services of renewable natural resources can affect future generations Unlike exhaustible resources, however, renewable resources can be consumed in a way that does not diminish their stocks Carrying Capacity and Future Generations The quantity of a renewable natural resource that can be consumed in any period without reducing the stock of the resource available in the next period is its carrying capacity Suppose, for example, that a school of 10 million fish increases by million fish each year The carrying capacity of the school is therefore million fish per year—the harvest of million fish each year will leave the size of the population unchanged Harvests that exceed a resource’s carrying capacity reduce the stock of the resource; harvests that fall short of it increase that stock As is the case with exhaustible natural resources, future generations have a stake in current consumption of a renewable resource Figure 13.11 "Future Generations and Renewable Resources" shows the efficient level of consumption of such a resource Suppose Qcap is the carrying capacity of a particular resource and S1 is the supply curve that reflects the current marginal cost of utilizing the resource, including costs for the labor and capital required to make its services available, given the interest rate and expected future demand The efficient level of consumption in the current period is found at point E, at the intersection of the current period’s demand and supply curves Notice that in the case shown, current Attributed to Libby Rittenberg and Timothy Tregarthen Saylor URL: http://www.saylor.org/books/ Saylor.org 718