For decades, economists (Cornucopians or optimists) have been at odds with natural scientists (Malthusians or pessimists) when it comes to the scarcity of natural resources. The economist’s argument, summarized here by Julian Simon, is as follows:

More people, and increased income, cause resources to become more scarce in the short run. Heightened scarcity causes prices to rise. The higher prices present opportunity, and prompt inventors and entrepreneurs to search for solutions. Many fail in the search, at cost to themselves. But in a free society, solutions are eventually found. And in the long run the new developments leave us better off than if the problems had not arisen. That is, prices eventually become lower than before the increased scarcity occurred. (Simon 1996)

The viewpoint of natural scientists seems to be a bit simpler; the more scarce something is the higher the price, leading to increasing prices as resources deplete over time. These opposing views have led to some famous wagers in the past. The most famous occurred in 1980 between economist Julian Simon and natural scientist Paul Ehrlich. The wager was whether the price of five metals would increase in ten years time. Simon won the bet. Another bet was made more recently. In 2005, John Tierney of the New York Times wagered with Matt Simmons over the price of oil. Simmons bet $5,000 that the price of oil would be $200 per barrel in 2010. Tierney won the bet.

As a result, Tierney has publicly applauded himself and the economists’ view in a recent article in the New York Times. He states: “Maybe something unexpected will change these happy trends, but for now I’d say that Julian Simon’s advice remains as good as ever. You can always make news with doomsday predictions, but you can usually make money betting against them.”

But what is the real message (if any) to be gleaned from these bets? Is it that economists are always right and natural scientists always wrong? Is it that prices decline for commodities over time?

I argue that there is very little (if anything) to be learned from these bets, and I explain why below the fold.

At the most recent ASPO-USA conference, I gave a presentation as part of a panel hosted by The Oil Drum. The subject matter of my post was taken from a recent paper developed by Charles Hall and me on peak oil, net energy, and economic growth. A much abridged version of the paper can be found in this post.

After the conference, Jane Van Ryan from the American Petroleum Institute (API) asked to interview me for her weekly podcast for the Energy Tomorrow blog. You can listen to the interview by clicking below, or alternatively, I have copied the transcript of the interview below the fold. The interview is 15 minutes long for those who would like to listen.

The Oil Drum recognizes that API (and hence Energy Tomorrow) is funded by the oil and gas industry. But the interview here relates to my research, which is not funded by such interests. I think the interview serves a useful purpose, because it makes my work accessible to a wider audience.

The following is the second of two posts based on a recent paper published under the same title in the journal Environment, Development, and Sustainability. I was the lead author for the article. The other two authors were Charles Hall and Bobby Powers. Part 1 of this series can be found at this link.

In the analysis underlying our paper "New Perspectives on the Energy Return on (Energy) Investment (EROI) of Corn Ethanol," we performed four major analyses relating to the EROI of corn ethanol. The first was a meta-error analysis, in which we quantified the error associated with the calculation of EROI of corn ethanol based on various estimates of the energy inputs and outputs found in the literature. The second was a spacial analysis of the EROI of corn ethanol. These two items were discussed in Part 1 of this series.

In this part, we will discuss a two additional research areas from the paper. These two additional research areas are:

• A sensitivity analysis, in which we assess the extent to which corn yields and co-product credits impact the EROI of corn ethanol.
• An assessment of how much net energy was delivered to society by ethanol in 2009.

We have also included our more general conclusions.

The following multi-part series is taken from a paper we published last year in the free, on-line journal Energies. You may access the entire PDF here. All references can be found in the pdf. Part 1 can be found here. Part 2 can be found here.

In this final installment of the Minimum EROI series we calculate the minimum EROI required from our energy sources to support the current transportation infrastructure of the U.S.