Glossary
Chapter 12: Resources: Scarcity and Abundance

No deletions in this chapter, but note my comment on Hotelling’s rule below.

B
backstop resource a resource that can substitute for a preferred resource but at a higher price.

C
choke price the minimum price of a good or service that would result in a zero quantity demanded.

cogeneration the process of using waste energy to produce heat from electricity generation.

D
deposit/return systems systems that encourage recycling by charging consumers a deposit when they purchase certain goods such as beverages in recyclable containers or batteries; the deposit is returned when the consumer returns the recyclable material to an appropriate location.

E
economic reserves (economically recoverable reserves) the quantity of a resource identified as economically feasible to extract given current prices and technology.

economic supply (of a resource) the amount of a resource that is available based on current prices and technology.

exponential reserve index an estimate of a resource lifetime based on existing economic reserves and a projected continuing percentage increase in resource use rates.

extraction path the extraction rate of a resource over time.

G
government procurement programs that guarantee a certain government demand for a good or service.

H
Hotelling's rule a theory stating that in equilibrium the net price (price minus production costs) of a resource must rise at a rate equal to the rate of interest. You will not need to know the math, only the reason for using hotelling’s rule and a verbal explanation of what it is saying.

hypothetical and speculative resources the quantity of a resource not identified with certainty but hypothesized to exist.

I
identified reserves the identified quantity of a resource; includes both economic and sub-economic reserves.

indicated or inferred reserves resources that have been identified but whose exact quantity is not known with certainty.

industrial ecology the application of ecological principles to the management of industrial activity.

M
marginal extraction cost the cost of extracting an additional unit of a nonrenewable resource.

measured reserves identified resources whose quantity is known with certainty.

N
nonrenewable resources resources available in fixed supply, such as metal ores and oil.

P
pay-by-the-bag systems waste disposal systems in which customers pay a fee for each unit of waste discarded.

physical supply (of a resource) available reserves measured in physical terms, without regard to the economic feasibility of recovery.

price path the price of a resource, typically a nonrenewable resource, over time.

price taker a seller in a competitive market who has no control over the product price.

R
recycling the process of using waste materials as inputs into a production process.

reserve base index an estimate of available resource reserves divided by the annual consumption rate; uses a broad estimate of available reserves.

resource lifetime the number of years the economic reserves of a resource are projected to last under expected consumption rates.

resource rents income derived from ownership of a scarce resource. Also referred to as Net Price ( price minus extraction costs).

resource substitution the use of one resource in a production process as a substitute for another resource, such as the use of aluminum instead of copper in electrical wiring.

resource use profile the consumption rates for a resource over time, typically applied to nonrenewable resources.

S
static reserve index an index that divides the economic reserves of a resource by the current rate of use for the resource.

subeconomic resources a resource quantity that cannot be economically extracted at current prices and technology.

T
technological lock-in the tendency of an industry to continue to use a given technology despite the availability of more efficient or cheaper technologies.

throughput the total use of energy and materials as both inputs and outputs of a process.

U
user cost(s) opportunity costs associated with the loss of future potential uses of a resource, resulting from consumption of the resource in the present.