Optimal Tariffs on Exhaustible Resources: The Case of Quantity Setting

Kenji Fujiwara () and Ngo Long

No 82, Discussion Paper Series from School of Economics, Kwansei Gakuin University

Abstract: Constructing a dynamic game model of trade of an exhaustible resource, this paper compares feedback Nash and Stackelberg equilibria. We consider two di erent leadership scenarios: leadership by the importing country, and leadership by the exporting country. We numerically show that as compared to the Nash equilibrium, both countries are better o if the importing country is a leader, but that the follower becomes worse o if the exporting country is a leader. Consequently, the world welfare is highest under the importing country's leadership and lowest under the exporting country's leadership.

Keywords: dynamic game; feedback Nash equilibrium; feedback Stackelberg equilibrium (search for similar items in EconPapers)
JEL-codes: C73 L72 (search for similar items in EconPapers)
Pages: 21 pages
Date: 2012-02, Revised 2012-02
New Economics Papers: this item is included in nep-com, nep-ene, nep-env and nep-gth
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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http://192.218.163.163/RePEc/pdf/kgdp82.pdf First version, 2012 (application/pdf)

Related works:
Journal Article: OPTIMAL TARIFFS ON EXHAUSTIBLE RESOURCES: THE CASE OF QUANTITY-SETTING (2012)
Working Paper: Optimal Tariffs on Exhaustible Resources: The Case of Quantity Setting (2012)
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