Exploring the structure of national consumption
This entry is a direct continuation of my:
In the past six entries I have been focused on preparing data for analysis. However, before proceeding further with analysis, I will make notes on the theoretical framework including hypothesis for socio-ecological drivers of resource subsidization and self-supply.
Here are some of the main variables I wil try to provide information for, today:
- age distribution of population (size of population unable to take up work)
- sector structure (service sector size)
- personal income (absolute size of personal income in relation to the purchasing power on national market)
- resource endowments (size of national resource reservoir)
- international resource security (the stability of resource supply and prices from potential donors)
- impacts of resource extraction and processing
- culture
- domestic conflict e.g. violent conflicts such as civil war
subsidy.framework.df<-data.frame("variable"=NA,"framework"=NA,"hypothesis"=NA,"subsidize.mechanism"=NA,"selfsupply.mechanism"=NA,"ref"=NA,"note"=NA,"analysis.note"=NA)
######################
## relative size of population that is too young and old to work
######################
row.name<-"aging pops"
subsidy.framework.df[row.name,]<-""
subsidy.framework.df[row.name,"variable"]<-"relative size of population that is too young and old to work"
subsidy.framework.df[row.name,"framework"]<-"demography"
subsidy.framework.df[row.name,"hypothesis"]<-"demography is destiny"
subsidy.framework.df[row.name,"subsidize.mechanism"]<-"fewer people available to take up work"
subsidy.framework.df[row.name,"selfsupply.mechanism"]<-"indirect: can spur technological innovation and worker immigration"
subsidy.framework.df[row.name,"ref"]<-"[@Zhang2002a]"
subsidy.framework.df[row.name,"note"]<-"macroecological mechanism: increasing size of older age classes during phases of decreasing population growth [life table theory and demography]. economics mechanism: negative relation between welfare (or GDP/capita) and human fertility"
######################
## progression of national economies toward service orientation
######################
row.name<-"service sector"
subsidy.framework.df[row.name,]<-""
subsidy.framework.df[row.name,"variable"]<-"size of national service sector in terms of economy and labor force"
subsidy.framework.df[row.name,"framework"]<-"economics"
subsidy.framework.df[row.name,"hypothesis"]<-""
subsidy.framework.df[row.name,"subsidize.mechanism"]<-"fewer people available for extraction of resources"
subsidy.framework.df[row.name,"selfsupply.mechanism"]<-"indirect: can spur technological innovation and worker immigration"
subsidy.framework.df[row.name,"ref"]<-"[@Eichengreen01012013]" #"[@Nie2003]"
subsidy.framework.df[row.name,"note"]<-"microeconomics mechanism: negative relation between desire to take up labor intensive work and level of income and education. To what degree is progression of national economies toward service orientation a process that is connected to demographic aging of national populations?"
subsidy.framework.df[row.name,"analysis.note"]<-"Questin in 'note' can be tested by assessing the degree to which primary, secondary and tertiary sectors grow as a percentage of GDP with demographic aging. "
######################
## personal income
######################
row.name<-"personal income"
subsidy.framework.df[row.name,]<-""
subsidy.framework.df[row.name,"variable"]<-"common personal income (e.g. median or lower quartile)"
subsidy.framework.df[row.name,"framework"]<-"economics"
subsidy.framework.df[row.name,"hypothesis"]<-""
subsidy.framework.df[row.name,"subsidize.mechanism"]<-"fewer people available for extraction of resources while personal consumption may increase due to increased income"
subsidy.framework.df[row.name,"selfsupply.mechanism"]<-"indirect: can spur technological innovation, since people with higher incomes may have more time to spend on socio-technical innovation"
subsidy.framework.df[row.name,"ref"]<-"[@Eichengreen01012013; @Mason2006]"
subsidy.framework.df[row.name,"note"]<-" microeconomics mechanism: negative relation between desire to take up labor intensive work and level of income, education etc."
######################
## resource endowment
######################
row.name<-"resource endowment"
subsidy.framework.df[row.name,]<-""
subsidy.framework.df[row.name,"variable"]<-"size of accessible resource reservoirs"
subsidy.framework.df[row.name,"framework"]<-"resource studies / ecology"
subsidy.framework.df[row.name,"hypothesis"]<-"e.g. curse of resource endowments"
subsidy.framework.df[row.name,"subsidize.mechanism"]<-"indirect: valued resource reservoirs may lead to conflict which hampers domestic supply and leads to increased imports of an otherwise abundance domestic resource"
subsidy.framework.df[row.name,"selfsupply.mechanism"]<-"efficient extraction of domestic resource reservoirs"
subsidy.framework.df[row.name,"ref"]<-"[@Torvik2009; @VanderPloeg2012]"
subsidy.framework.df[row.name,"note"]<-"the role of resource endowments has an abundant literature full of interesting controversies"
######################
## international resource security
######################
row.name<-"international security"
subsidy.framework.df[row.name,]<-""
subsidy.framework.df[row.name,"variable"]<-"predictability and stability of resource imports"
subsidy.framework.df[row.name,"framework"]<-"political science / economics"
subsidy.framework.df[row.name,"hypothesis"]<-""
subsidy.framework.df[row.name,"subsidize.mechanism"]<-"high non-domestic supply security should, all else beig equal, make national extraction less of a prioirty"
subsidy.framework.df[row.name,"selfsupply.mechanism"]<-"indirect: various feedbacks to security, e.g. market feedbacks... (?)"
subsidy.framework.df[row.name,"ref"]<-"[@Green2005]"
subsidy.framework.df[row.name,"note"]<-""
######################
## impacts of resource extraction and processing
######################
row.name<-"handling impact"
subsidy.framework.df[row.name,]<-""
subsidy.framework.df[row.name,"variable"]<-"undesirable attributes of resource extraction e.g. health or accessibility"
subsidy.framework.df[row.name,"framework"]<-"resource studies / economics / public health"
subsidy.framework.df[row.name,"hypothesis"]<-""
subsidy.framework.df[row.name,"subsidize.mechanism"]<-"undesirable impacts of resource extraction should lead countries to choose imports over extraction when a reliable import supply is avaiable"
subsidy.framework.df[row.name,"selfsupply.mechanism"]<-"speculative: possibly some sort of innovation based hypothesis"
subsidy.framework.df[row.name,"ref"]<-"[@Hilborn1995; @Foley2005]"
subsidy.framework.df[row.name,"note"]<-""
######################
## culture oriented towards self-supply / subsidies
######################
row.name<-"culture"
subsidy.framework.df[row.name,]<-""
subsidy.framework.df[row.name,"variable"]<-"incidence of cultures impacting decisions regarding consumption structure"
subsidy.framework.df[row.name,"framework"]<-"cultural studies"
subsidy.framework.df[row.name,"hypothesis"]<-""
subsidy.framework.df[row.name,"subsidize.mechanism"]<-"e.g. cultures that emphasize other values than work related to extraction, such as 'global citizen' related cultures"
subsidy.framework.df[row.name,"selfsupply.mechanism"]<-"e.g. cultures that emphasize self-reliance, such as possibly 'nationalism', 'imperialism'"
subsidy.framework.df[row.name,"ref"]<-"[@Hilborn1995]"
subsidy.framework.df[row.name,"note"]<-"i will need to read up on the role of culture in resource consumption"
######################
## domestic conflict - e.g. violent conflict such as civil war
######################
row.name<-"domestic conflict"
subsidy.framework.df[row.name,]<-""
subsidy.framework.df[row.name,"variable"]<-"frequency, duration and severity of violent or political conflicts"
subsidy.framework.df[row.name,"framework"]<-"political science / conflict studies"
subsidy.framework.df[row.name,"hypothesis"]<-"e.g. curse of resource endowments"
subsidy.framework.df[row.name,"subsidize.mechanism"]<-"conflicts hampering extraction or processing of resources leading to increased imports"
subsidy.framework.df[row.name,"selfsupply.mechanism"]<-"isolationism or boykots associated with domestic conflict (speculative?)"
subsidy.framework.df[row.name,"ref"]<-"[@Cai2013, @Torvik2009; @Turner2004; @Maxwell2000]"
subsidy.framework.df[row.name,"note"]<-""
######################
### WRITING TABLE
######################
subsidy.framework.df<-subsidy.framework.df[-1,]
row.names(subsidy.framework.df)<-paste("**",row.names(subsidy.framework.df),"**",sep="")
knitr::kable(subsidy.framework.df)| variable | framework | hypothesis | subsidize.mechanism | selfsupply.mechanism | ref | note | analysis.note | |
|---|---|---|---|---|---|---|---|---|
| aging pops | relative size of population that is too young and old to work | demography | demography is destiny | fewer people available to take up work | indirect: can spur technological innovation and worker immigration | (Zhang and Lee 2002) | macroecological mechanism: increasing size of older age classes during phases of decreasing population growth [life table theory and demography]. economics mechanism: negative relation between welfare (or GDP/capita) and human fertility | |
| service sector | size of national service sector in terms of economy and labor force | economics | fewer people available for extraction of resources | indirect: can spur technological innovation and worker immigration | (Eichengreen and Gupta 2013) | microeconomics mechanism: negative relation between desire to take up labor intensive work and level of income and education. To what degree is progression of national economies toward service orientation a process that is connected to demographic aging of national populations? | Questin in ‘note’ can be tested by assessing the degree to which primary, secondary and tertiary sectors grow as a percentage of GDP with demographic aging. | |
| personal income | common personal income (e.g. median or lower quartile) | economics | fewer people available for extraction of resources while personal consumption may increase due to increased income | indirect: can spur technological innovation, since people with higher incomes may have more time to spend on socio-technical innovation | (Eichengreen and Gupta 2013; Mason et al. 2006) | microeconomics mechanism: negative relation between desire to take up labor intensive work and level of income, education etc. | ||
| resource endowment | size of accessible resource reservoirs | resource studies / ecology | e.g. curse of resource endowments | indirect: valued resource reservoirs may lead to conflict which hampers domestic supply and leads to increased imports of an otherwise abundance domestic resource | efficient extraction of domestic resource reservoirs | (Torvik 2009; Ploeg and Venables 2012) | the role of resource endowments has an abundant literature full of interesting controversies | |
| international security | predictability and stability of resource imports | political science / economics | high non-domestic supply security should, all else beig equal, make national extraction less of a prioirty | indirect: various feedbacks to security, e.g. market feedbacks… (?) | (Green 2005) | |||
| handling impact | undesirable attributes of resource extraction e.g. health or accessibility | resource studies / economics / public health | undesirable impacts of resource extraction should lead countries to choose imports over extraction when a reliable import supply is avaiable | speculative: possibly some sort of innovation based hypothesis | (Hilborn, Walters, and Ludwig 1995; Foley et al. 2005) | |||
| culture | incidence of cultures impacting decisions regarding consumption structure | cultural studies | e.g. cultures that emphasize other values than work related to extraction, such as ‘global citizen’ related cultures | e.g. cultures that emphasize self-reliance, such as possibly ‘nationalism’, ‘imperialism’ | (Hilborn, Walters, and Ludwig 1995) | i will need to read up on the role of culture in resource consumption | ||
| domestic conflict | frequency, duration and severity of violent or political conflicts | political science / conflict studies | e.g. curse of resource endowments | conflicts hampering extraction or processing of resources leading to increased imports | isolationism or boykots associated with domestic conflict (speculative?) | (Cai and Newth 2013, Torvik (2009); Turner 2004; Maxwell and Reuveny 2000) |
- age distribution of population (size of population unable to take up work)
- sector structure (service sector size)
- personal income (absolute size of personal income in relation to the purchasing power on national market)
- resource endowments (size of national resource reservoir)
- international resource security (the stability of resource supply and prices from potential donors)
- impacts of resource extraction and processing
- culture
- domestic conflict e.g. violent conflicts such as civil war
Developed countries are currently undertaking a transition to a regime of low growth and increasing age in the population. This transition is generally associated with a parallel transition to an economy based on an expanding service and innovation sector, and consumed goods increasingly imported from other parts of the world. This trajectory, if general, has wide implications for global sustainability as more and more developing countries start their demographic and economic transitions. When using the UN population scenarios of changing age classes, how much will governments have to raise or cut in the future to keep a balanced budget.
References
Cai, Yiyong, and David Newth. 2013. “Oil, Gas and Conflict: A Mathematical Model for the Resource Curse.” PloS One 8 (6): e66706. doi:10.1371/journal.pone.0066706.
Eichengreen, Barry, and Poonam Gupta. 2013. “The two waves of service-sector growth.” Oxford Economic Papers 65 (1): 96–123. doi:10.1093/oep/gpr059.
Foley, Jonathan a, Ruth Defries, Gregory P Asner, Carol Barford, Gordon Bonan, Stephen R Carpenter, F Stuart Chapin, et al. 2005. “Global consequences of land use.” Science (New York, N.Y.) 309 (5734): 570–4. doi:10.1126/science.1111772.
Green, B E. 2005. “A general model of natural resource conflicts: The case of international freshwater disputes.” Sociologia 37 (3): 227–48. <Go to ISI>://WOS:000232562400002.
Hilborn, R, C J Walters, and D Ludwig. 1995. “Sustainable Exploitation of Renewable Resources.” Annual Review of Ecology and Systematics 26: 45–67. <Go to ISI>://A1995TH33000004.
Mason, Andrew, Ronald Lee, An-Chi Tung, Mun-Sim Lai, and Tim Miller. 2006. “Population aging and intergenerational transfers: introducing age into national accounts,” no. January 2005: 52. http://www.nber.org/papers/w12770.pdf?new\_window=1.
Maxwell, J W, and R Reuveny. 2000. “Resource scarcity and conflict in developing countries.” Journal of Peace Research 37 (3): 301–22. <Go to ISI>://WOS:000087100100002.
Ploeg, Frederick van der, and Anthony J. Venables. 2012. “Natural Resource Wealth: The Challenge of Managing a Windfall.” Annual Review of Economics 4 (1): 315–37. doi:10.1146/annurev-economics-080511-111003.
Torvik, R. 2009. “Why do some resource-abundant countries succeed while others do not ?” Oxford Review of Economic Policy 25 (2): 241–56. doi:10.1093/oxrep/grp015.
Turner, M D. 2004. “Political ecology and the moral dimensions of ‘resource conflicts’: the case of farmer-herder conflicts in the Sahel.” Political Geography 23 (7): 863–89. doi:10.1016/j.polgeo.2004.05.009.
Zhang, Jie, and Ronald Lee. 2002. “Rising longevity , education , savings , and growth,” no. 510.