Market Power in Nonrenewable Resource Markets: An Empirical Dynamic Model
نویسندگان
چکیده
This paper estimates a dynamic model of the world markets for five nonrenewable resources over the period 1970-2004 and tests for market power in each of these markets. In particular, for each nonrenewable resource, we test whether the countries supplying the nonrenewable resource behaved as price-takers or oligopolists. The results show that during the study period the world markets for copper, iron, lead, tin, and zinc were characterized by oligopolistic behavior. Our model enables us to estimate an upper bound for the price elasticity of demand for those markets exhibiting market power. We find that the demand for copper, iron, lead, and zinc is relatively inelastic, while the demand for tin is extremely elastic.
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