Innovation and Natural Resources: A Dynamic Game with Uncertainty

Christopher Harris and John Vickers

RAND Journal of Economics, 1995, vol. 26, issue 3, 418-430

Abstract: We analyze a dynamic game between a resource-exporting country and an importing country that is seeking to invent a substitute technology. The time of innovation is an uncertain function of the importer's R&D efforts, which cannot be committed in advance. The game has a unique equilibrium in Markov strategies. The importer's R&D efforts grow over time. The exporter's output often decreases with time before innovation occurs, but strategic factors imply that the opposite can happen. The output path is characterized by a simple modification of Hotelling's rule to account for uncertainty and strategic behavior.

Date: 1995
References: Add references at CitEc
Citations: View citations in EconPapers (24)

Downloads: (external link)
http://links.jstor.org/sici?sici=0741-6261%2819952 ... O%3B2-1&origin=repec full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

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:rje:randje:v:26:y:1995:i:autumn:p:418-430

Ordering information: This journal article can be ordered from
https://editorialexp ... i-bin/rje_online.cgi

Access Statistics for this article

More articles in RAND Journal of Economics from The RAND Corporation
Bibliographic data for series maintained by ().