DEMAND ENDOWED SUPPLY; AN ANALYSIS OF THE ECOMOMICS OF RECLAMATION
| DOI | http://doi.org/10.1111/j.1467-9485.1963.tb00332.x |
| Date | 01 June 1963 |
| Published date | 01 June 1963 |
DEMAND ENDOWED SUPPLY:
AN
ANALYSIS
OF
THE
ECONOMICS
OF
RECLAMATION
K.
J.
W. ALEXANDER
AND
R.
W.
HOUGHTON
THE
economic significance of secondary
or
reclaimed supplies
is
the
major topic considered in this paper. The activities of the reclamation
trades have not, apparently, figured very much
in
the descriptive and
analytical writings of economists. Some non-economists engineers, and
scientists, who have come up against analytical problems in this field
do
not seem to have provided wholly satisfactory answers.
In
what
follows
a
consideration
of
the phenomenon of what we have ventured
to call
demand
endowed
supply
leads on to some simple analysis
of
its
economic implications.
I
Particularly in advanced industrial countries, at any point in time
large quantities
of
materials are immobilised in goods, either
in
use
or
lying disused but not yet scrapped. These categories of course contain
only a fraction of the material inputs
of
the past: losses due to
abrasion, corrosion and physical transformation are inevitable. Where
recovery from
a
previous use is possible and secondary supplies
result, the initial allocation of some resources is only temporarily at
the expense of alternative uses.
Secondary supplies from the point of view
of
the economist are
akin to land, although they are the gift of the past rather than of
nature. Real costs are normally incurred in making them available
to users because material requires collection as well as grading and
refining. It is possible to increase future supplies by conservation.
One interesting consequence of the use /reclamation/re-use cycle
is
that significant geographical redistributions of resources may be
achieved. New Zealand for example is
just
beginning
to
produce her
own steel entirely from scrap reclaimed from past imports of iron and
steel manufactured goods.
Interpreted broadly, reclamation covers a diversity of activities.
It includes the rehabilitation of consumer goods (the restoration
of
old
furniture, for instance) and the activities
of
second hand markets.’ It
includes conversions such as the use of teak from broken ships to
1
See
A.
H.
Fox,
‘A
Theory
of
Secondhand Markets
’,
Econornica,
N.S.
Vol.
xxiv,
p.
99.
198
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