[lbo-talk] James Hamilton on oil

[Shane Taylor]

I meant to post this when I last heard Robin Mills on Behind The News. Mills, contrasting geologists and economists, spoke solely of geological myopia: focusing on oil in the ground without taking account of changes in geopolitics, technology, and prices. Fair enough, but that only acknowledges one blind spot. Too many economists assume that sustained high prices will magic up the technology to deliver us from conservation.

It's best to grab the waving hand of a glibertarian when they say The Market will solve our energy problems. Changing incentives can change behavior, as surely as you can raise dust by pummeling straw. But how much will come from conservation and how much will come from new tech? The abrupt inducement of the former can be a vicious shock, and the latter is neither a given nor independent of what happens before the price jumps.

I must have the luxury of not personally knowing many catastrophists, but I do know a legion of technophiles. In the interest of moving the debate beyond them both, here is James Hamilton on two subjects mentioned on Behind The News:

Northern Ghawar is in decline
<http://www.econbrowser.com/archives/2007/05/northern_ghawar.html>

Peak oil in America
<http://www.econbrowser.com/archives/2007/05/peak_oil_in_ame.html>

More under "MOST REQUESTED" beneath "PEAK OIL."

Shane