Introduction

Encapsulated in environmental and natural resource management is the problem of time. It permeates each resource utilisation problem with which man is faced. 'Neoclassical' capital theory incorporates the time dimension in a quite adequate way, from the point of view of the current generation, evaluating intertemporal resource allocations using the equivalent present value of alternative allocations (at current real rates of interest) as the appropriate choice set and from which the allocation with the highest net present value is the socially optimal intertemporal allocation viewed from the present. But can we trust myopic, efficiency-based, self-interest maximising criteria to allocate resource use between generations, particularly if the allocation is from a fixed stock of exhaustible resources? Is the current generation convinced that decisions about exhaustible resource extraction made earlier in the twentieth century are appropriate from the viewpoint of the present generation. (Oil is the example that springs most immediately to mind.) This leads us not only into a discussion of efficiency versus equity between generations, but also into a discussion as to whether the utilitarian, present-value-maximising criterion is only myopically efficient. ¹ Most of the section is concerned primarily with the 'fairness' of alternative rates of extraction resulting from alternative choice criteria for alternative rates of extraction.