ABSTRACT
Although the title of this chapter, 'Economics and resources', is a seemingly clear phrase, it may in fact mean different things to different sectors of the audience. Non-economists will no doubt expect a disquisition on what economists have to say about the use and depletion of the earth's resources of oil, coal, mineral ores, etc: to the general public, the word resources immediately conjures up issues of this type. To the economists, however, it has a slightly broader import: the subject matter of economics was defined in the 1930s as 'The study of the allocation of scarce resources between competing uses', and this is a statement that is still difficult to better as a simple definition. But when in this definition we refer to the allocation of scarce resources, we have in mind not just the earth's exhaustible resources, but rather the whole of society's economic resources - i.e. all possible inputs into the productive process. This of course includes exhaustible resources, but also contains available inputs of human skill and capital equipment, and in general when economists talk about resources and resource allocation the word is being used in this broad sense to include both earth's resources and the human and capital resources available to a society.
