ABSTRACT
Post-Keynesian theorists view the economic problems surrounding raw materials (that is, natural resources) in a very different light from orthodox neoclassical economic theorists. This point can perhaps best be illustrated in the context of the current so-called “energy crisis.” Orthodox economic theory has taught that businessmen’s single-minded pursuit of profit opportunities, tempered by competition and the absence of externalities, would result in an optimum allocation of resources and the maximization of the community’s welfare. A post-Keynesian perspective would instead suggest that such price changes can best be understood (and an appropriate policy response formulated) by analyzing the behavior of entrepreneurial agents and resource property owners in terms of perceived market power and/or expectations about the future. For those who adopt the post-Keynesian approach to economic analysis, the decision to utilize natural resources is therefore viewed as similar to that of disinvestment in capital equipment, while the search for new sources of natural resources is merely a form of capital investment.
