ABSTRACT
The previous chapters have examined the historical background to modern economic theories of natural-resource scarcity, have noted the most significant non-economic influences on these theories in recent times, and have summarized conventional economic approaches to problems of resource depletion, pollution and environmental preservation. As noted in the Introduction, however, increasing attention has been called to a new class of environmental problems that require a different kind of theoretical approach from that used to deal with the more conventional problems. In general, this new class of problems is characterized by a process of cumulative environmental degradation resulting from economic activity that may lead to severe ecological disruption and the collapse of human livelihoods. The problem of natural-resource scarcity is therefore one of trade-offs — controlling environmental degradation in the long run versus increasing economic activity in the short run. Thus a new, or alternative, theoretical approach is required in order to analyse the phenomenon of this special type of natural-resource scarcity; to allow explicit consideration of the irreversi-ble qualitiative change typified by environmental degradation; to incor-porate the economic impacts of ecological disturbances; to examine the trade-offs among all the functions of the environment; and to consider the intertemporal implications of these trade-offs.
