Scarcity, resource price uncertainty, and economic growth

Over the course of the past decade, significant steps have been taken to empirically link indicators of resource scarcity to changes in economic growth. This paper extends this precious literature in two ways. First, rather than concentrating exclusively on energy, we focus on the technological change embodied in the prices of an array of complementary natural resource inputs. Second, we investigate (using (G)ARCH methods) the importance of resource price uncertainty as well as resource price levels on aggregate economic growth. We find that output growth is significantly influenced by both resource price levels and resource price uncertainty.