The compilation of a list and description of scarce and natural resources with correct definitions depends on the context in which one views natural resources. Natural resources are not easy to define and describe if one looks at it in the context of international trade. Most definitions of natural resources tend to consider the resources as they exist in the natural state. Using this context, natural resources are divided into renewable and nonrenewable natural resources.
Renewable natural resources are defined as those natural resources which can be easily replenished in a certain time. Renewable natural resources include:
a) Air, which is easily replenished. To some extent, wind, which is now being considered as a source of alternate energy generation, is also included under air.
2) Biotic natural resources, such as plants and animals, fisheries, forests and sea organisms. Over a period of time, these natural resources can also be renewed.
3) Food and other useful crops cultivated through agriculture take slightly longer periods to be replenished but are renewable.
4) Soils can get exhausted through over-cultivation but when left to recover, they are also renewable.
5) Water sources are also renewable natural resources.
6) Solar power is now being considered as the most viable alternate energy source; this is also obtained from sunlight, which is a renewable energy source.
Non-renewable natural energy sources are defined as those which cannot be easily replenished or renewed as their formation periods are extremely long and span over several geological eras. Non-renewable natural energy sources include:
1) Coal has been used rapidly since the industrial revolutions, which leads to increased demand. It takes very long to form within the earth and as such is being depleted very fast.
2) Fossil fuels, like petroleum and natural gas, also form in a very long geological process and by the year 2050, all sources of these fuels will be exhausted on earth.
3) Mineral resources such as iron, steel, aluminum, tin, carbon, silicon, zinc and especially copper have been mined at a very high rate ever since their demand has risen (due to the industrial and scientific revolutions). These metals and their ores are being constantly depleted. Although these metals can be recovered for reuse through recycling, recycling of metals like copper is expensive and not widely practiced. As a result, the natural reserves of such metals are fast decreasing.
4) Rocks and the products obtained from them (diamonds and other precious as well as semi-precious stones) are also defined as nonrenewable, since their formation takes extremely long geological time-frames.
Although it is easy to use different classification systems to make a list and description of scarce natural resources, it is difficult to define. Ambiguous, intermediate and final goods made from natural resources, for example, vehicles are made from iron ore or things like paper, which are produced from wood, and most other goods are manufactured from some scarce natural resource. However, a clear definition given by the WTO (World Trade Organization) about natural resources is “stocks of materials that exist in the natural environment that are both scarce and economically useful in production or consumption, either in their raw state or after a minimal amount of processing”.
Why Are The Costs Increasing?
As technological advances grow, so does the demand for scarce natural resources. The result is over-use of these resources and depletion of their existing reserves. As existing reserves of any natural resource grow scarce and the demand continues to rise, the price rises automatically. Several key factors determine the price of scarce resources like exhaustibility, uneven distribution across nations, negative externalities, or consequences in other regions and dominance within national economies, trade policies and price volatility.
Despite all these factors having a part in the rising cost of scarce natural resources, as long the demand for a resource is not falling (and the cost is not manipulated by interference like government policies or international cartels), the resource’s cost will continue to rise as its remaining reserves decline. Thus, all cost rises can be interpreted as a reliable signal that the particular natural resource is getting scarcer. On the contrary, if the price of a resource shows an actual decrease in cost consistently and without any regulatory interference, it is very unlikely that its existing reserves are growing scarce. The list and description of scarce natural resources provided above indicates that excessive use and depleting reserves of these resources are the factors responsible for the rising costs of such resources.
1) Barnett, H. J., and Chandler Morse. 91963). Scarcity and Growth: The Economics of Natural Resource Availability. Baltimore: Johns Hopkins University Press for Resources for the Future, 1963.
2) Baumol, William J. and Sue A.B. Blackman. (2008).Natural Resources. Library of
Economics and Liberty. May 24, 2010. Online at: https://www.econlib.org/library/enc/naturalresources.html
3) Neumayer, E. “Scarce or Abundant? (2000). The Economics of Natural Resource Availability.” Journal of Economic Surveys 14, no. 3 (2000): 307–335.
4) National Commission on Supplies and Shortages, 1976; and U.S. Geological Survey. Online at: https://www.usgs.gov.
5) Resources for the Future. Online at: https://www.rff.org.
6) World Trade Report 2010. Online at: https://www.wto.org/english/res_e/publications_e/wtr10_e.htm