Question

Explain the causes for increasing scarcity of resources

Answer 1

Answer:

A rise in demand can cause a resource to become scarce. ... This dramatic increase in people (combined with rising incomes and economic output) has put a greater strain on many natural resources – causing greater scarcity amongst some resources and new forms of scarcity – such as rising sea levels.

Answer 2

Answer:

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Resource scarcity is defined as a situation where demand for a natural resource is exceeding the supply – leading to a decline in available resources. When we talk about scarce resources, we usually imply that current use is unsustainable in the long-term.

Scarcity can involve non-renewable resources, such as oil, precious metals and helium. It can also involve potentially renewable resources, which are being consumed faster than their ability to replenish (e.g. over-fishing, excess use of fresh water.)

Causes of scarcity

1. Demand-induced – High demand for resource
2. Supply-induced – supply of resource running out.
3. Structural scarcity – mismanagement and inequality
4. No effective substitutes.

A rise in demand can cause a resource to become scarce. For example, when a civilisation has a small population, freshwater is abundant with hardly any opportunity cost. However, with a rising population, a well or reservoir may fail to keep up with the increase in demand. For example, between 1950 and 2000, the population of Sub-Saharan Africa increased from 177 million to 657 million creating increased pressure on the limited farmland.

The global population has increased from 2 billion people in 1927 to 7 billion in 2012. This dramatic increase in people (combined with rising incomes and economic output) has put a greater strain on many natural resources – causing greater scarcity amongst some resources and new forms of scarcity – such as rising sea levels.

According to a UN report, the last century saw a dramatic increase in annual global resource extraction – From 7 billion tons (7 Gt) in 1900 to about 50 billion tons (55 Gt) in 2000 (UN Renewable Consultation) p.19

Demand induced scarcity could occur due to:

1. Growth in population.
2. Growth in real GDP and incomes enabling people to consume more resources than before.
3. Changes in preference, e.g. growth in demand for mobile phones, places greater demand on certain metals, like cobalt and nickel used in the production of lithium batteries. Increase

Explanation: