[Editor note: The original title of the post of Dr. Brätland (bio at end) was “Institutions and Policies that Impede Capital Maintenance for Extractive Firms.” Resourceship is a term used by the late economist Stephen McDonald (1924–2006) to describe entrepreneurship applied to mineral resources.
Although capital maintenance by extractive firms refutes the exhaustion myth of minerals, this refutation hinges on access to lands, entrepreneurial latitude in managing resources, and secure private-property rights.
In particular, certain institutions of governmental control and jurisprudence hinder entrepreneurial actions of extractive firms striving to maintain capital (defined as the asset value of to-be-extracted minerals).
These hindrances include:
(a) Foreclosure of land access by government ownership of mineral lands;
(b) Foreclosure of entrepreneurial latitude by court imposed covenants enforcing obligations to surface owners; and
(c) In the case of petroleum, the extractive firm’s inability to acquire full control and ownership of reservoirs it has discovered.