Monopoly Power can be Disadvantageous in the Extraction of a Durable Nonrenewable Resource

Larry Karp

Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series from Department of Agricultural & Resource Economics, UC Berkeley

Abstract: We study a Markov equilibrium for the case where a monopolist extracts a nonrenewable resource which is converted to a durable good, which then depreciates at a constant rate. We show that in a stationary, continuous time model (infinite horizon, infinitesimal period of commitment) monopoly power can be disadvantageous. Numerical experiments c o n f i that this can also occur in a finite horizon, discrete model. This result is compared to previous examples of disadvantageous market power, obtained using two-period models.

Keywords: disadvantageous market power; durable good; nonrenewable resources; Coase conjecture (search for similar items in EconPapers)
Date: 1995-03-01
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.escholarship.org/uc/item/4cs0m1vb.pdf;origin=repeccitec (application/pdf)

Related works:
Journal Article: Monopoly Power Can Be Disadvantageous in the Extraction of a Durable Nonrenewable Resource (1996)
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:cdl:agrebk:qt4cs0m1vb

Access Statistics for this paper

More papers in Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series from Department of Agricultural & Resource Economics, UC Berkeley Contact information at EDIRC.
Bibliographic data for series maintained by Lisa Schiff ().