Fixed costs, efficient resource management, and conservation

This article develops a framework to analyze the impacts on resource development of efficient management practices that account for possible resource conserving technological changes. Compared with the traditional management practice ignoring these changes, efficient management may not delay or reduce resource development, depending on the level of the changes. Under efficient management, a higher probability of resource conserving technologies may not delay or reduce resource development. These ambiguities are due to the existence of fixed and increasing marginal costs in resource development.