The Hartwick Rule: Myths and Facts

G.B. Asheim, W. Buchholz, C.A.A.M. Withagen

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Abstract

We shed light on the Hartwick rule for capital accumulation and resource depletion by providing semantic clarifications and investigating the implications and relevance of this rule.We extend earlier results by establishing that the Hartwick rule does not indicate sustainability and does not require substitutability between man-made and natural capital.We use a new class of simple counterexamples (i) to obtain the novel finding that a negative value of net investments need not entail that utility is unsustainable, and (ii) to point out deficiencies in the literature.
Original languageEnglish
Place of PublicationTilburg
PublisherMicroeconomics
Number of pages24
Volume2002-52
Publication statusPublished - 2002

Publication series

NameCentER Discussion Paper
Volume2002-52

Keywords

  • natural resources
  • sustainable development
  • capital accumulation

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  • Cite this

    Asheim, G. B., Buchholz, W., & Withagen, C. A. A. M. (2002). The Hartwick Rule: Myths and Facts. (CentER Discussion Paper; Vol. 2002-52). Microeconomics.