Steady-state growth in a Hotelling model of resource extraction.

This paper re-examines the Hotelling model of optimal nonrenewable resource extraction in light of stock effects and technological progress. We assume functional forms for cost and demand so that the solution to the Hotelling problem is a steady-state consistent with the empirical observation that t...

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Published in:Journal of Environmental Economics & Management Vol. 54; no. 1; pp. 68 - 84
Main Authors: Lin, C.-Y. Cynthia, Wagner, Gernot
Format: Article
Published: Academic Press Inc. July 2007
Subjects:
Online Access:View this record in EBSCOhost
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        atl: Steady-state growth in a Hotelling model of resource extraction.
      aug:
        au:
          Lin, C.-Y. Cynthia
          Wagner, Gernot
      su:
        Hotelling, Harold, 1895-1973
        Mathematical models
        Resource exploitation
        Minerals
        Natural resources
        Prices
      sug:
        subj:
          Mathematical models
          Resource exploitation
          Minerals
          Natural resources
          Prices
          Hotelling, Harold, 1895-1973
      ab: This paper re-examines the Hotelling model of optimal nonrenewable resource extraction in light of stock effects and technological progress. We assume functional forms for cost and demand so that the solution to the Hotelling problem is a steady-state consistent with the empirical observation that the growth rates of market prices have remained zero over a long period of time. We use data on 14 minerals from 1970 to 2004 to estimate the supply and demand functions using SUR and 3SLS and to test the model. We validate the model for 8 of 14 minerals. Copyright (c) 2007 Elsevier Inc.
      pubtype: Academic Journal
      doctype: Article
      src: R
    language: English
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