Optimal resource extraction under stochastic terms of trade

Optimal resource extraction under stochastic terms of trade

Optimal Resource Extraction Contracts under Threat of Expropriation

The government contracts with a foreign firm to extract a natural resource that requires an upfront investment and which faces price uncertainty. In states where profits are high, there is a likelihood of expropriation, which generates a social cost that increases with the expropriated value. In this environment, the planner’s optimal contract avoids states with high probability of expropriatio...

Feasible Alternatives under Deteriorating Terms of Trade*

The paper presents a dynamic general equilibrium model of a small open economy which employs an essential imported input in production. The economy is said to be capable of survival, if, given the technology and the time-pat:: of world prices, there is at least one sequence of feasible decisions on intertemporal resource allocation sustaining a positive stationary level of consumption indefinit...

Optimal Resource Allocation in Activity Networks under Stochastic Conditions

We treat the problem of optimally allocating a single resource under uncertainty to the various activities of a project to minimize a certain economic objective composed of resource utilization cost and tardiness cost. Traditional project scheduling methods assume that the uncertainty resides in the duration of the activities. Our research differs from the traditional view in that it assumes th...

Resource Allocation Under Stochastic Demands

Military theater settings may involve many competing missions whose whose requirements tax the coalition’s resources in multiple dimensions—i.e., requiring different amounts of many different kinds of resources, e.g., fuel, bandwidth, personnel, etc., each of which is available in limited supply— and in uncertain or stochastic amounts. To serve the overall mission, we need to satisfy resource r...