Environmental and Resource Management under Myopia

Tomoki Fujii

DEGIT Conference Papers from DEGIT, Dynamics, Economic Growth, and International Trade

Abstract: Myopia is important in environmental and resource management. We present a parsimonious extension to a standard dynamic optimization in a continuous time and continuous state setting, which enables a rich description of myopic behavior. In our model, the process of planning future controls and choosing the current control are clearly distinguished. We examine the behavior of various types of myopic agents with a simple non-renewable resource extraction problem. We show that constant discounting may be a poor approximation to myopic agents in our model. We also discuss the relevance of the expiry of extraction permits in resource management.

Keywords: Non-constant discounting; resource management; myopia; time-consistency; observational equivalence (search for similar items in EconPapers)
JEL-codes: C61 Q30 Q50 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2008-11
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Related works:
Working Paper: Environmental and Resource Management under Myopia (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:deg:conpap:c013_031

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