If people don't value oil, they don't extract it, so there's no depletion.
If people value it, they are going to try to buy it. The more the buy, the scarcer it turns. The scarcer it turns, the more expensive it is; so the less demanded it is and the slower it is extracted.
Extraction is going to arrive to a halt before complete depletion occurs.
6 comments:
The point to explain is precisely why the halt to extraction is going to arrive first than depletion.
Adrián, I would like to know if your analysis of oil depletion is based on praxeology or are you making some non-praxeological assumptions, for example, that the less supply there is of an economic good, the higher it's price will become
Mariano, first, what is non-praxeological assumptions for you? Because as I see it, you can talk about non-praxeological assertions, but not about non-praxeological assumptions. If I say, plus the basic action axiom I add the axiom that agents always prefer blue things to non-blue things, I still can develop a perfectly correct praxeologic theory. The fact that a theory only applicable to a universe in which people always prefer blue things to other colors things is irrelevant in our world of non-always-prefering-blue people only condemns relevance but not praxeologic correctness of such a theory.
Second, I don't find my explanation neither irrelevant nor logically wrong in the sense of deducting conclusions not based on the axioms. I'd appreciate if you can show me either the irrelevance (based on an axiom uncommon in the real world) or some misdeduction in my explanation.
Adrián, you said
"The scarcer it turns, the more expensive it is; so the less demanded it is and the slower it is extracted."
I believe that this is not a praxeological deduction, because it is possible (praxeologically speaking) that the scarcer an economic good becomes, the lower its prize will be, for example, I could imagine (praxeologically speaking) that the oil companies could be willing to extract the remaining oil and sell it at the same prize because they have decided that they want to give it as a gift to the consumers or something like that.
What I mean is that your analysis is not a logical consequence of the axiom of human action alone because one has to suposse that people always want to gain money as much as possible. Even if you assume that, it is ambiguos what means as much as possible, since I suppose that would depend on the person
Anyway, I hope I cleared my doubt
Mariano
Mariano, what if I say "The scarcer it turns, ceteris paribus, the more expensive it is"?
By "ceteris paribus", I particularly (not exclusively though) mean no changes in the demand by would-buyers and the attitudes from producers like those you mention.
Would that dissolve your doubt?
I think I would be willing to agree with you if you add the ceteris paribus clause.
Mariano
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