We propose a new methodology exploring Markov perfect equilibrium strategies in differential games with regime switching. Specifically, we develop a general game with two players having two kinds of strategies. Players choose an action that influences the evolution of a state variable, and...

I investigate two versions of a differential Cournot oligopoly game with nonrenewable resource exploitation, in which each firm may either exploit its own private pool or exploit a common pool jointly with the rivals. Firms use a deterministic technology to invest in exploration activities. In...

In the presence of rising carbon concentrations more attention should be given to the role of the oceans as a sink for atmospheric carbon. We do so by setting up a simple dynamic global carbon cycle model with two reservoirs containing atmosphere and two ocean layers. The net flux between these...

This paper links Hotelling's theory, in recent literature applied to an emission constrained environment, with the classical capacity planning framework to describe portfolio time-paths in electricity production. Emission targets are considered by a ceiling on the stock of pollution. We propose...

This paper investigates a problem of optimal growth with resource exhaustibility and pollution externality, based on a unified framework that explicitly considers augmentable man-made capital, exhaustible resource reserves, and accumulative environmental pollutants as three stock variables for...

It would seem that Hotelling's rule and its related models of resource extraction and electricity production as largest consumer of scarce resources are closely related. However, although fixed costs and a non-storable product are essential in characterizing electricity markets, they can hardly...

We translate Hotelling's continuous-time, exhaustible resource extraction Model of 1931 into a linear program of present value extraction cost minimization subject to a stock endowment and period by period demand constraints. The appropriate form of the demand constraints allows for resource...

The relationships among the Hamiltonian, NNP, and the level of sustainable consumption/utility have been widely misunderstood. This paper dispels the misconceptions and provides further new insight into these relationships. We show generally that for autonomous dynamic optimizing economies, a...