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42 TAMÁS Kocsis
of its coal stocks and to the technologies based on them (e.g., the steam engine).
These allowed it to move beyond its limited stocks of firewood and to decrease
costs (Christensen 1999: 21).
Any review of classical economic theories gives a prominent place to the dispute
between Thomas Malthus and David Ricardo on the scarcity of the natural
resources reguired by agriculture. Bennett and Morse (1963) summed up their
positions as that of the absolute scarcity of the natural resources (Malthus) as
opposed to their relative scarcity (Ricardo) (cf. Barbier 1989: 1). Indeed, Malthus
spoke about the absolute limits of tillable land, and claimed that if all available
agricultural areas were used, the feeding of extra numbers of people would only
be possible if the intensity of cultivation was increased on the given area. The
return (surplus produce) from the given area would grow, but at a declining rate.
By contrast, Ricardo attributed the amount of diminishing returns to the
deterioration of the quality of land put under cultivation, because he held that the
highest-quality land was constantly tilled, while the remaining poor-quality areas
began to be cultivated later (see table) (Barnett — Morse 1963: 51; cited in Barbier
1989: 1-2).
Table 1. Comparison of Malthus’s and Ricardo’s theories of agricultural land
Malthus Ricardo
quality of arable land homogeneous heterogeneous
emergence of diminishing returns | after full exhaustion always occurs
nature of scarcity absolute relative
substitution of resources none some
source of scarcity internal (subsistence level) internal (subsistence level)
Malthusian absolute scarcity therefore means that the quality of all natural resources
(arable land) is homogeneous and therefore that the phenomenon of diminishing
returns occurs after depletion. Since at the time of the absolute limit, all suitable
land would be under cultivation, there is no substitutability between resources.
In other words, the rising cost of one factor cannot stimulate effective substitution.
In contrast, Ricardo argued for the heterogeneous quality of natural resources, and
consequently, the phenomenon of declining increments always appears. Rising
costs (prices) may be signals for the economy — though latently in Ricardo’s
reasoning — and since not all resources are utilized, it is possible to substitute the
relatively expensive and scarce resource for a cheaper one (Barbier 1989: 3-4; cf.
Pearce — Turner 1990: 6-7).
While Ricardo’s views may appear more optimistic than Malthus’s, it must be
pointed out that Ricardo pinpointed a more intriguing characteristic of nature
— the limited fertility of arable land. At the same time, it is also significant that
both Malthus and Ricardo regarded the ultimate source of scarcity as intrinsic to
nature. This constraint appears because the subsistence level of the labor force
presupposes a certain minimum, and the paid wage must reach a minimum level.
However, if this was the single constraint on the growth of the economy, it would
mean that the trap could be avoided by replacing labor with capital (Barbier 1989:
8-9, 11). Later critics of growth argue that this is a false conclusion (see later).