In economics, we deal with two time periods, short run as well as long run. Changes occur in short run but the ultimate theory is designed on the basis of long run. Apparent short run movements in variables show absolutely different results in long run. Same results can be observed through the bet between Julian L. Simon and Paul Ehrlich upon the five commodity metals, inflation-adjusted and fifteen environmental trends in different wagers. Both economists fought on the point whether the prices move upward or in downward stream. Ehrlich was pessimist (the prices will increase) in his argument where Simon was optimist (the prices will decrease).
Ehrlich pointed out the demographic changes in the world which result in increasing demand, emerging the scarcity and depletion of irreversible resources, deterioration of environmental resources, increasing diseases, global warming and so on. On the other side, Simon described the hierarchy as; when population increases and over the period of time the income of the people also increases, their demand will increase. Because of limited supply, prices will go up. In the meanwhile, economists will try to find out the solution. If they fail, long run mechanism will provide the solution by itself. Moreover, the scarcity is not of the resources but the scarcity of declining capacity of our planet and lack of technology and substitution methods to increase the productivity.
On five commodity metals namely copper, chromium, nickel, tin, and tungsten, Simon won the bet but not on the inflation-adjusted (1996-2011) and fifteen environmental trends (1994 2004) which were consisting upon the deterioration of of earth temperature, human and land fertility, agricultural soil, rice and wheat production, firewood availability, moist forest, fishery harvest, plants and animals. The increasing trends were undertaken in carbon dioxide and nitrous oxide, concentration of Ozone layer, air-pollution, deaths through...
Please join StudyMode to read the full document