Monopoly power can be disadvantageous in the extraction of a durable nonrenewable resource
Karp, L. (1996) Monopoly power can be disadvantageous in the extraction of a durable nonrenewable resource. International Economic Review, 37, (4), 825-849.
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Description/Abstract
We study a Markov equilibrium for the case where a monopolist extracts a nonrenewable resource which is converted to a durable good, which then depreciates at a constant rate. We show that in a stationary, continuous time model (infinite horizon, infinitesimal period of commitment) monopoly power can be disadvantageous. Numerical experiments confirm that this can also occur in a finite horizon, discrete model. This result is compared with previous examples of disadvantageous market power, obtained using two-period models.
| Item Type: | Article |
|---|---|
| ISSNs: | 0020-6598 (print) |
| Related URLs: | |
| Subjects: | H Social Sciences > HB Economic Theory H Social Sciences > HA Statistics |
| Divisions: | University Structure - Pre August 2011 > School of Social Sciences > Economics |
| Item ID: | 32970 |
| Date Deposited: | 28 Jun 2007 |
| Last Modified: | 01 Jun 2011 02:10 |
| Contributors: | Karp, L. (Author) |
| Date: | 1996 |
| Status: | Published |
| URI: | http://eprints.soton.ac.uk/id/eprint/32970 |
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