HotellingÂ’s Exhaustible Resource Extraction Model as a Linear Program

John Hartwick ()

No 1506, Working Paper from Economics Department, Queen's University

Abstract: We ”translate”Hotelling’s continuous-time, exhaustible resource extraction Model of 1931 into a linear program of present value extraction cost minimization subject to a stock endowment and period by period demand constraints. The appropriate form of the demand constraints allows for resource rent rising at the rate of interest in the dual program. A useful variant has the stock size endogenous.

Keywords: resource extraction; linear program; rent and interest rate (search for similar items in EconPapers)
JEL-codes: C61 D46 Q32 (search for similar items in EconPapers)
Pages: 6 pages
Date: 2023-07
New Economics Papers: this item is included in nep-ene and nep-env
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Persistent link: https://EconPapers.repec.org/RePEc:qed:wpaper:1506

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