Managing Extractive Resource Wealth for Sustainability: Lessons from Alaska Seen Through the Lens of Maximum Sustainable Yield

• Main Author: Goldsmith, Oliver Scott
• Format: Report
• Language: English
• Published: Institute of Social and Economic Research, University of Alaska Anchorage 2012
• Subjects: north slope; Prudhoe Bay; Alaska
• Online Access: http://hdl.handle.net/11122/3950

Presented at the Western Regional Science Association Annual Meeting Kauai, Hawaii Alaska has enjoyed a generation of unprecedented economic growth and prosperity driven by crude oil production primarily from one giant field, Prudhoe Bay, on the North Slope. Through a number of financial savings accounts, including the Alaska Permanent Fund, the Statutory Budget Reserve, and the Constitutional Budget Reserve, the state has successfully converted a share of petroleum wealth into $55 billion in financial assets. It has been less successful in diversifying the economic base away from dominance by oil and gas production. Now oil production has fallen to less than 1/3 of its peak and this decline is projected to continue—reducing public revenues and private economic activity. This paper will explore whether the state of Alaska has the resources to be able to transition successfully to a Post-Prudhoe Bay economy, how that transition could take place, and what impediments might prevent a successful transition. This analysis will be of interest to other natural resource dependent economies that are trying to manage the cycles that resource extraction generate. Northrim Bank.