The Optimal Use of Exhaustible Resources under Nonconstant Returns to Scale

Serguei Kaniovski

VfS Annual Conference 2017 (Vienna): Alternative Structures for Money and Banking from Verein für Socialpolitik / German Economic Association

Abstract: The paper offers a complete analysis of the welfare-maximizing capital investment and resource depletion policies in the DHSS model with capital depreciation and any returns to scale. We establish a general existence result and show that an optimal admissible policy may not exist if the output elasticity of the resource equals one. We characterize the optimal policies by applying an appropriate version of the Pontryagin maximum principle for infinite-horizon optimal control problems.

JEL-codes: C61 O38 Q01 Q56 (search for similar items in EconPapers)
Date: 2017
New Economics Papers: this item is included in nep-cta, nep-ene, nep-env and nep-gro
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc17:168079

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