As the world's population continues to grow, the demand for natural resources will only increase. Unfortunately, these resources are not unlimited. Depletion is an accounting technique used to allocate the cost of extracting these finite resources from the earth. By understanding depletion, we can better manage these resources and ensure their sustainability for future generations.Depletion occurs when natural resources are extracted from the earth at a rate that is greater than the rate at which they are replaced. The cost of depletion is the reduction in the value of resources that results from their over-exploitation. This cost is not currently reflected in market prices, which leads to an inefficient allocation of resources.There are a number of ways to calculate depletion. The most common approach is to estimate the amount of a resource that can be extracted at a sustainable rate and then subtract that amount from the total resource base. This sustainable yield is typically determined by estimating the amount of a resource that can be replaced through natural reproduction or through investment in new resources.The depletion equation is:-D = S – RWhere D is the depletion, S is the sustainable yield, and R is the rate of resource extraction.
The depletion of natural resources is a global problem that needs to be addressed through international cooperation. The United Nations Environment Programme (UNEP) deals with environmental issues including the depletion of natural resources through its Global Environment Monitoring System (GEMS).The depletion of natural resources can have a number of adverse effects on society. The cost of depletion is a reduction in the value of natural resources that results from their over-exploitation. This cost is not currently reflected in market prices and leads to an inefficient allocation of resources.Using a simple example, if the cost of lumber could be determined, a builder would pay more for wood from a tree that had grown for many years, resulting in better wood. At present, however, the depletion of natural resources is not reflected in the price of wood, so lumber from older trees is discarded.
