Natural Resources, Economic Growth and Geography

Abstract

In this paper we discuss the relationship between economic growth and natural resources at a global level, taking into account geography. With this aim, our model integrates elements of the theories of endogenous growth, natural resources and new economic geography. We find that an increase in the world growth rate can lead to a higher depletion of the natural resources following an increase in the world demand due to expansion in population. However, the consideration of geography and growth mechanisms make the relationship between growth and natural resources more complex, and can even lead to the opposite conclusion when the forces behind growth are different from world demand. Indeed, either a reduction in transport costs or an increase in R&D productivity appears to be able to generate a faster growth compatible with a lower depletion of natural resources.

Overview of research on marine resources and economic development

“…Although the growth of total output is often decomposed into capital factor inputs, labor factor inputs and total factor productivity increases, the neoclassical growth model (Solow, 1956) does not include resource factors in the analysis of the production function and economic growth factors, ignoring the role of resources in the economy. However, marine resources are an important component of a country's national wealth, and a great deal of scholarly research and development has found that marine resources are a positive contributor to economic development (Gonz alez-Val and Pueyo, 2019). Watkins (1963) found that the exploitation and export of marine resources are closely related to economic and industrial development.…”