Julian Simon vs. Paul Ehrlich: The “Bet” Revisited

In today’s New York Times, John Tierney not only revisits the famous bet between Simon and Ehrlich in 1980 but discusses the results of a bet that Simon’s wife and he placed with Ehrlich’s followers.  The question is an age old one: What will happen to the price of natural resources when economies grow?  Ehrlich argued that finite stocks of such resources would lead to rapidly rising prices.  Simon argued that human ingenuity and substitutes would keep such prices from rising very rapidly.  Ehrlich’s followers bet that the price of oil would rise to $200 per barrel by January 1, 2011 from $65 per barrel in August 2005.  Obviously, Tierney and Simon bet against.  You probably can guess who will win, but you should read the story anyway.