Scarcity, Scarcity Knowledge and the Legitimation of Market-Based Scarcity Indicators

This paper explores whether market-based scarcity indicators can re-flect resource scarcity correctly. In this context, two objections against market-based indicators made by Norgaard [15] are examined. Poten-tially, resource allocators are not informed correctly of scarcity and maybe they ignore some aspects of scarcity consciously. The traditional view of scarcity is reviewed and its flaws revealed. Finally, a reinterpre-tation of scarcity is introduced which legitimizes market-based scarcity indicators.