Claims that oil deposits and other extractive resources are exhaustible often conflate physical exhaustion (total depletion of the physical stock of a resource) with economic exhaustion (loss of the expected profitability required to induce resource owners to continue extracting and marketing the resource). Yet that distinction is crucial, because when private-property rights are unencumbered, entrepreneurs usually have several strategies available for maintaining the economic value of their firms while they continue to operate them.
|Other Independent Review articles by John Brätland
|Efficiency as Undetermined Allocation: On a Just Privatization of U.S. Offshore Resources
|Capital Concepts as Insights into the Maintenance and Neglect of Infrastructure
|Externalities, Conflict, and Offshore Lands: Resolution Through the Institutions of Private Property