We estimate a reduced form model of the redwood timber industry that is consistent with Hotelling's exhaustible resource theory. The consequences for this theory of various assumptions about the elasticity of expectations are derived. The estimated equations are used to test the hypotheses about...

How potential entrants to an open-access fishery form their expectations determines the fishery's adjustment path to a steady state but not the steady state values themselves. It is well known that, in the standard model with myopic expectations (those based on current values), boats enter the...