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Quotation of the Day…

Posted By Don Boudreaux On January 20, 2012 @ 8:37 am In Complexity & Emergence,Environment,Growth,Innovation,Myths and Fallacies,Property Rights,Seen and Unseen,Technology,The Economy,The Future,The Profit Motive | Comments Disabled

… is from pages 42-43 of Julian Simon’s 1996 masterpiece, The Ultimate Resource 2 [1]:

There is an almost insuperable difficulty in the definition of available “copper,” “oil,” and so on, because there are many different grades of each resource in places that vary in difficulty of extracting the resource, and because . . . the amounts at low concentrations (such as the quantities of metals on the sea bottom and in seawater) are extraordinarily large in contrast to the quantities we usually have in mind (the “proven reserves”).  What’s more, we constantly create new supplies of resources, in the sense of discovering them where they were thought not to exist.  (In the past, the U.S. Geological Survey and others thought that there was no oil in California or Texas.)  Often, new supplies of a resource come from areas outside of the accustomed  boundaries of our system, as resources from other continents came to Europe in past centuries and as resources may in the future be brought from the sea or from other planets.  New supplies also arise when a resource is created from other materials, just as grain is grown and nuclear fuel is “bred.”

…. In exactly the same way that we manufacture paper clips or hula-hoops, we create new supplies of copper.  That is, we expend time, capital, and raw materials to get them.  Even more important, we find new ways to supply the services that an expensive product (or resource) renders.

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[1] The Ultimate Resource 2: http://www.amazon.com/Ultimate-Resource-Julian-Lincoln-Simon/dp/0691003815/ref=sr_1_2?s=books&ie=UTF8&qid=1321288652&sr=1-2

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