The Hotelling rule argues that the price for a nonrenewable resource adjusts to the shadow value of the resource, reflecting the remaining availability of the resource. We empirically test the Hotelling rule on the effect of unanticipated oil field discoveries. We do not find evidence for a...

We show how a monopolistic owner of oil reserves responds to a carbon-free substitute becoming available at some uncertain point in the future if demand is isoelastic and variable extraction costs are zero but upfront exploration investment costs have to be made. Not the arrival of this...

Trotz des starken Rückgangs der Rohölpreise seit dem Herbst 2008 ist das Preisniveau mit gegenwärtig rund 60 US-Dollar pro Fass immer noch deutlich höher als im langfristigen Durchschnitt. Die Marktmacht der Organisation erdölexportierender Länder (OPEC) ist nach wie vor sehr groß und...

This paper proposes a partial equilibrium model to describe the global crude oil market. Pricing on the global crude oil market is strongly influenced by price indices such as WTI (USA) and Brent (Northwest Europe). Adapting an approach for pool-based electricity markets, the model captures the...

This article proposes a complementary explanation for why oil-rich economies have experienced a relative low GDP growth over the last decades: the proportion of taxes in the prices of petroleum products have been globally increasing for the four last decades, thus making oil revenues grow slower...

In this paper we study the problem of exhaustible resources and renewable resources in a theoretical endogenous growth framework, under various assumptions. In particular, we consider the hypotheses that those two inputs are or are not technologically perfect substitutes of each other. Moreover,...

Optimal climate policy is studied in a Ramsey growth model with exhaustible oil reserves, an infinitelyelastic supply of renewables, stock-dependent oil extraction costs and convex climate damages. Weconcentrate on economies with an initial capital stock below that of the steady state of the...

We consider a competitive extraction industry comprising many small firms, each with a slightly different quality of mineral holdings. With "rapidly" declining quality of holding per firm we observe rent declining over and interval. We do not work with the planning solution, commonly invoked in...

Fossil fuels are non-renewable carbon resources, and the extraction path of these resources depends both on present and future demand. When this Hotelling feature is taken into consideration, the whole price path of carbon fuel will shift downwards as a response to the reduced cost of the...