5. A backstop technology is a technology that becomes economical to use when the price of an...
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5. A backstop technology is a technology that becomes economical to use when the price of an exhaustible resource exceeds a certain level. For example, electric- ity generated from photovoltaic cells is a backstop technology for electricity gener- ated from fossil fuels. How is the efficient intertemporal extraction of an exhaustible resource likely to be influenced by backstop technology? Does it make any differ- ence whether the backstop technology for an exhaustible resource involves extrac- tion of another exhaustible resource or exploitation of a renewable resource?
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