Economic growth and non-renewable resourses

The purpose of this paper is twofold. First we study an endogenous growth model where the production function depends on non - renewable natural re- sources. We examine whether this introduction of non - renewable resources could alleviate the knife - edge problem of standard endogenous growth the- ory for a broader range of parameters values than Stiglitz (1974). The second part of this paper investigate the Ramsey-like dynamics of non-renewable re- source abundance on economic growth and welfare in a two country world. In particular in this part we analyze how initial factor endowments of non- renewable resources in°uence income, growth and welfare in a two country world. We show that in principle, whether a non - renewable resource rich country grows faster or slower than another country depends upon economic structure