Abstract

Harold Hotelling’s article ‘The Economics of Exhaustible Resources’ (1931) is considered groundbreaking in the history of nonrenewable resource economics, with the elaboration of the famous ‘Hotelling rule’ (p'(t)/p(t)=r). Economists and historians have highlighted the novelty of Hotelling’s work compared to the state of the art at the time, and some have underlined the formal similarities between his rule and the capital depreciation equations, legitimizing analogies between nature and productive capital (e.g. natural capital concept). But where does Hotelling’s model come from and why was it so innovative? How did a young economist-mathematician come to work on nonrenewable resources in the 1920s? What impact did his background and preparatory work have on his final paper, published in 1931, and more broadly on the subsequent evolution of the discipline, until today?

These are the questions that will be addressed in this presentation, on the basis of the results of a collective project at the crossroads of environmental, natural-resource and energy economics on the one hand, and the history of economic thought on the other, a project based on an unprecedented in-depth examination of Harold Hotelling’s personal archives, from his student’s years at the University of Washington in the 1910s to his arrival at the University of Columbia in 1931.

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