Sustainable growth and valuation of mineral reserves
Author(s)Adelman, Morris Albert
Massachusetts Institute of Technology. Center for Energy and Environmental Policy Research.
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The annual change in the value of an in-ground mineral is equal to the increase or decrease of inventories ("reserves"), multiplied by the market value of a reserve unit. The limited shrinking resource base does not exist. Its inter-generational optimizing is a phantom problem. If there is any "Hotelling rent" it is captured by the reserve market value, which is created by investment in knowledge (exploration) and in productive facilities (development). There are problems of concepts and data. But examples for recent years suggest that mineral value changes are small.
MIT Center for Energy and Environmental Policy Research
MIT-CEEPR (Series) ; 94-010WP.