Testing the Assumptions and Predictions of the Hotelling Model

详细信息    查看全文

• 作者：Calvin Atewamba ; Bruno Nkuiya
• 关键词：Nonrenewable natural resources ; Optimal extraction ; Resource prices ; Hotelling model ; Panel data
• 刊名：Environmental and Resource Economics
• 出版年：2017
• 出版时间：January 2017
• 年：2017
• 卷：66
• 期：1
• 页码：169-203
• 全文大小：
• 刊物类别：Business and Economics
• 刊物主题：Environmental Economics; Environmental Law/Policy/Ecojustice; Economic Policy; Economics, general; Environmental Management;
• 出版者：Springer Netherlands
• ISSN：1573-1502
• 卷排序：66

文摘

In this paper, we empirically examine whether the assumptions and predictions of the Hotelling model are consistent with patterns observed in data. We consider nonlinear functional forms for the extraction cost and resource demand to develop an empirical Hotelling model with technological progress and stock dependent extraction costs. Using panel data on fourteen nonrenewable natural resources to estimate this empirical Hotelling model, we get qualitatively different results as compared to the related literature. We find evidence of stock-dependent extraction costs for most resources. There is no evidence against the linearity of the optimal extraction rate in the resource stock for almost all resources studied. Furthermore, the Hotelling model may sustain a zero long-run growth rate in resource prices. These results depend on whether firms use different extractive technologies or whether the structural break observed on resource prices is taken into account.