The Hartwick rule and the characterization of constant consumption paths in the presence of an exhaustible resource

This paper deals with the interpretation of the Hartwick rule in the particular Dasgupta-Heal-Solow model with one capital good and one non-renewable resource. It is argued that the rule is more a descriptive property of constant consumption paths than a sustainability indicator. It is shown that investing the rents from the resource use into man-made capital is a necessary condition for an efficient resource depletion but it is not a sufficient condition for sustainability. A sustainable consumption indicator is described to characterize the sustainability of constant consumption paths.