We provide an introductory review to the application of the theory of incentives under asymmetry of information to the exploitation and management of natural resources. We concentrate mostly on principalagent problems with adverse selection as posed by the regulation of nonrenewable resources,...

Uncertainties as to future supply costs of nonrenewable natural resources, such as oil and gas, raise the issue of the choice of supply sources. In a perfectly deterministic world, an efficient use of multiple sources of supply requires that any given market exhausts the supply it can draw from...

Whether vertical integration between a downstrean oligopolist and an upstream oligopolist is profitable for an integrated pair of firms is shown to depend on how one formulates the questions, on the number of firms in each oligopoly and on the type of interaction which is assumed between firms...

In existing papers on dynamic incentive contracts, the dynamic structure of the principal-agent relationship arises exclusively from the ability of the principal to learn about the hidden information over time. In this paper we deal with a different source of dynamics, which is considered...

We investigate investment behavior when there is asymmetry of information between owners (the principal) and managers (the agent). The model accepts the standard cost-of-adjustment model as a particular case and is directly compared with it. For all types, information asymmetry distorts the...

We propose a simple model of a partially integrated industry which explicitly takes into account persistent production cost differences across upstream firms, such as one might observe in natural resource industries. The model allows us to highlight the respective roles of strategic...