Indefinitely sustained consumption despite exhaustible natural resources

Games with Exhaustible Resources

We study N -player continuous-time Cournot games in an oligopoly where firms choose production quantities. These are nonzero-sum differential games, whose value functions may be characterized by systems of nonlinear Hamilton-Jacobi partial differential equations. When resources are in finite supply, such as oil, exhaustibility enters as boundary conditions for the PDEs. We analyze the problem w...

Classical Theory and Exhaustible Natural Resources: Notes on the Current Debate

RESUMEN. El tratamiento de los recursos naturales no reproducibles en el contexto de la Teoría Económica Clásica es objeto de un intenso debate en la actualidad. Concretamente, existen diversas opiniones sobre si es adecuado utilizar la noción de precios naturales o de producción clásicos para el análisis de los precios de estos recursos naturales (royalties) y también se han propuesto varios p...

Optimal Growth Paths with Exhaustible Resources: an Information-based Model

Dynamic Investment in Extraction Capacity of Exhaustible Resources

This paper applies real options theory into a resource extraction problem with capacity constraints and demand uncertainty. The producer decides on the optimal rate of extraction and the optimal time to build further capacity simultaneously. It is shown that previous results which suggest that extraction capacity should be built at the beginning, are not necessarily true under uncertainty. The ...

Intertemporal Alloca Tion of Exhaustible Resources: a Simple Geometric Interpretation

September 1980 FfC Bureau of Etoo mics working papers are preliminary materials circulated to iimnlate discussion and critical comment All data coo tained in them are in the public domain. This includes information obtained by the Commissioo which has become part of public record. The analyses and conclusions set forth are those of the authors and do not necessari ly reflect the views of other ...