Cost Specification and Firm Behaviour in a Hotelling Model of Resource Extraction

Denise Young

Canadian Journal of Economics, 1992, vol. 25, issue 1, 41-59

Abstract: In applied resource economics much attention has been focused.on the ability of the Hotelling model to explain observed firm behavior. In this paper, a preliminary specification search is performed to determine the appropriate cost function parameterization for the firms in the sample before proceeding to the estimation of the Euler equation. Once a cost function specification is chosen, the corresponding Euler equation is estimated via the Generalization Method of Moments (GMM), which allows for better estimates of the Euler equations than in previous studies. Even with the preliminary specification search and the use of GMM estimation, the behavior of the panel of fourteen Canadian copper mining firms in the data set examined does not seem to be consistent with the basic Hotelling model used.

Date: 1992
References: Add references at CitEc
Citations: View citations in EconPapers (27)

Downloads: (external link)
http://links.jstor.org/sici?sici=0008-4085%2819920 ... SAFBI%3E2.0.CO%3B2-X (text/html)
only available to JSTOR subscribers

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cje:issued:v:25:y:1992:i:1:p:41-59

Ordering information: This journal article can be ordered from
https://www.economic ... ionen/membership.php

Access Statistics for this article

Canadian Journal of Economics is currently edited by Zhiqi Chen

More articles in Canadian Journal of Economics from Canadian Economics Association Canadian Economics Association Prof. Werrner Antweiler, Treasurer UBC Sauder School of Business 2053 Main Mall Vancouver, BC, V6T 1Z2. Contact information at EDIRC.
Bibliographic data for series maintained by Prof. Werner Antweiler ().